Abstract
Why could law and economics theory (hereinafter L&E ) develop to become the most prominent theory in US legal scholarship, while still playing only a minor role in Europe? As this article is also meant as a gloss, as “a propagandist tracet”,1 I herein make use of my academic freedom to write freely also on controversial issues. If there is a grain of truth in what I am proposing here, it might help to de-mystify L&E theory and classify it to what it to my mind, really is: one very convincing and influential theory, but only one theory out of many that might explain the law. I will argue that it is not only the persuasiveness of the theory that helped to establish the continental divide in legal thought. But that cultural reasons also contributed to a significant extent. Some of them, such as World War II, are external social factors. Other factors, such as the influence of the Olin foundation, resulted from internal factors. As Grechenig and Gelter convincingly explain, at the beginning of the movement in the nineteenth and the early twentieth century the developments were comparable in Europe and the USA. The Nazi regime and World War II then marked a turning point, which resulted in reservations against L&E thinking. Europe responded with a renaissance of classical legal thought (hereinafter CLT ), while in the USA, the L&E theory developed further unhindered. This development, however, was not autonomous but influenced by man-made culture on both sides. Only recently, arguments from L&E are able to grasp hold in Europe. Interestingly, this development goes hand in hand with the upcoming of a new generation that has not been influenced by World War II. Furthermore, this generation benefited greatly from incentive mechanisms to grapple with American legal thinking through funding and the legal society likewise. The fall of the Berlin wall, I will argue, marks a second point in history, which brings L&E arguments to Europe and classical legal thought to the USA. I will close with a call for a specific EU-based idea of L&E , which starts from the outset as a method freed from the ideological struggles that accompanied the introduction of L&E in the USA. It shall live towards the aim of establishing both, a free and social market economy.
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Notes
- 1.
Henry Simons, cited after Coase, p. 240.
- 2.
Bengoetxea, pp. 65 et seqq.
- 3.
v. Caenegem, pp. 44–48.
- 4.
Mattei and Pardolesi, pp. 265 et seqq.
- 5.
Grechenig and Gelter, pp. 295 et seqq.
- 6.
Grechenig and Gelter, pp. 309 et seqq.
- 7.
Kant, § 83.
- 8.
Mathis, ‘Consequentialism’, pp. 3 et seqq.
- 9.
Micklitz, ‘Visible Hand’, pp. 3.
- 10.
See Mathis, ‘Normative Principle’, pp. 113 et seqq.
- 11.
See regarding the many schools which use “L&E” as an umbrella term Macneil, pp. 696 et seq.
- 12.
These facets are what Macneil correctly describes as unifying factors of L&E-theory, see Macneil, p. 697.
- 13.
See Kennedy, pp. 465–474; v. Jhering , Scherz und Ernst, pp. 262 et seq.
- 14.
See Esser, p. 20: “[T]he legal institute and the codified norm [is] only one category among other factors and materials that influence the decision: logic, principles, legal terms, precedents and other sources of law. All of which influence what is dubbed ‘interpretation’ and ‘subsumtion’, whereas the unity of the ‘system’ in the view of necessary antagonisms of several factors and principles lies not within the corpus iuris, but is created each time through the process of interpretation.” (own translation).
- 15.
Komesar, pp. 4 et seq.
- 16.
Heath Pearson, Origins of Law and Economics – The Economists’ New Science of Law, 1830–1930.
- 17.
v. Jhering , Law as a Means, p. 34.
- 18.
v. Jhering , Law as a Means, p. 34.
- 19.
Mackaay, pp. 69–71.
- 20.
For a similar interpretation see Summers, Essays, p. 30.
- 21.
v. Jhering , Law as a Means, p. 345.
- 22.
v. Jhering , Law as a Means, p. 325.
- 23.
v. Jhering , Law as a Means, pp. 267–294.
- 24.
Summers, Essays, p. 30.
- 25.
See Rob van Gestel and Hans-Wolfgang Micklitz propose the opposite, when they argue that v. Jhering took “a distance from formalism and systematization”, see v. Gestel and Micklitz, p. 29.
- 26.
Micklitz, ‘Introduction’, p. 19.
- 27.
Ari Afilalo, Dennis Patterson and Kai Purnhagen, ‘Statecraft, the Market State and the Development of European Legal Culture’.
- 28.
Blaug, p. 126: “Storytelling makes use of the method that historians call colligation, the bundling together of facts, low-level generalizations, high level theories, and value judgements in a coherent narrative, held together by a glue of an implicit set of beliefs and attitudes that the author shares with his readers.”
- 29.
For matters of clarification it shall be noted here that one many use statistical and economic evidence likewise for ideological manipulation, see Ruckelshaus, p. 157–158: “[D]ata can be like the tortured spy. If you torture it long enough it will tell you anything you want to know.”
- 30.
Holmes, ‘Path’, p. 457.
- 31.
Holmes, ‘Science’, p. 456.
- 32.
Holmes, The Common Law, p. 41.
- 33.
Holmes, ‘Path’, p. 469.
- 34.
Wallace, pp. 399 et seqq.
- 35.
Grechenig and Gelter, p. 351.
- 36.
Kantorowicz, pp. 335 et seqq.
- 37.
Micklitz, ‘Introduction’, p. 19.
- 38.
Grechenig and Gelter, pp. 351 et seq.
- 39.
James Dubois, Judgment and Sachverhalt: An Introduction to Adolf Reinach’s Phenomenological Realism.
- 40.
See Kai Purnhagen, ‘The Architecture of Post-National European Contract Law: A Question of Institutions?’; Sophie Loidolt, Einführung in die Rechtsphänomenologie.
- 41.
Schapp, ‘Sein und Ort’, p. 39.
- 42.
Grechenig and Gelter, pp. 351 et seqq.
- 43.
Herbert Hart , ‘Scandinavian Realism’.
- 44.
Brian Leiter, ‘Legal Realisms, Old and New’.
- 45.
Alexander, pp. 132 et seqq.
- 46.
Brian Leiter, ‘Legal Realisms, Old and New’.
- 47.
Grechenig and Gelter, p. 348.
- 48.
Mattei and Pardolesi, pp. 265 et seqq.
- 49.
See for similar analyses of this claim Régis Lanneau, ‘Dogmatics in Comparison to US-American Law and Economics – Dogmatism as Cultural Element of Law in Europe?’; Steven Teles, The Rise of the Conservative Legal Movement.
- 50.
Mathis, Efficiency, p. v.
- 51.
Mathis, Efficiency, p. 1.
- 52.
Coase, p. 240.
- 53.
Henry Manne: “anything out of Chicago law school at that time was ideological”, cited after Teles, p. 99.
- 54.
Macneil, pp. 697 et seq.; Teles, p. 96; Mathis, Efficiency, p. 1.
- 55.
Teles, p. 99.
- 56.
Kötz, p. 100 (own translation).
- 57.
Coase, p. 243.
- 58.
Coase, p. 243.
- 59.
Teles, p. 93, with further references.
- 60.
Tamanaha, p. 101.; Posner , p. 761.
- 61.
Mackaay, pp. 66–67.
- 62.
Priest, p. 325: “Pure originality, however, is a peculiar standard for intellectual influence. Originality does not correspond to influence; most commonly, the relationship might be reversed.”
- 63.
Priest, p. 325.
- 64.
See Carney, pp. 215 et seqq.
- 65.
Rubin, p. 333; Teles, pp. 105 et seq.
- 66.
Teles, p. 108.
- 67.
Miller, p. 66.
- 68.
Teles, p. 110.
- 69.
Rubin, p. 333.
- 70.
Rubin, p. 333.
- 71.
See Priest, p. 325, who notes with subtle irony in fn. 12: “That these resorts were uniformly near fancy golf courses was coincidence.”
- 72.
Teles, p. 142.
- 73.
Teles, p. 118.
- 74.
Teles, pp. 186 et seq.
- 75.
Teles, p. 189.
- 76.
Teles, p. 192.
- 77.
Russel, p. 3.
- 78.
Teles, pp. 193–199.
- 79.
See Teles, p. 200, with further reference.
- 80.
See v. Gestel and Micklitz, p. 37.
- 81.
Greenberg, p. 443.
- 82.
See Friedrich, ‘Evolution’.
- 83.
See the notes of Friedrich, ‘Evolution’, pp. 197–210, who characterized the difference between constitutional and sovereign dictatorships as the main difference between the American and the Soviet occupations of Germany.
- 84.
See Jens-U. Franck and Kai Purnhagen, ‘Homo Economicus, Behavioural Science, and Regulation: On the Concept of Man in Internal Market Regulation and its Normative Basis’.
- 85.
Ari Afilalo, Dennis Patterson and Kai Purnhagen, ‘Statecraft, the Market State and the Development of European Legal Culture’.
- 86.
Craig, p. 14.
- 87.
See on the difference between the nation states’ law that strived for protection of sovereignty and the conflicting pro-integrationist interpretation of EU law Ari Afilalo, Dennis Patterson and Kai Purnhagen, ‘Statecraft, the Market State and the Development of European Legal Culture’.
- 88.
See Kötz, p. 94; Ernst-Joachim Mestmäcker, A Legal Theory With Law.
- 89.
See for a reading on the ordoliberal school Megay, pp. 422 et seqq.
- 90.
See Patterson and Afilalo, pp. 3, 29.
- 91.
Thomas Grey, ‘The New Formalism’.
- 92.
Scalia, p. 25.
- 93.
Schauer, ‘Formalism’, pp. 509 et seqq, esp. p. 548; Frederik Schauer, Playing.
- 94.
Weinrib, pp. 21 et seq.
- 95.
Summers, ‘Formal’, pp. 1165 et seqq.
- 96.
Scalia, p. 25.
- 97.
To some, this has already yielded the need for a counter-development; see v. Gestel and Micklitz, p. 25.
- 98.
See e.g. the Institute for Law and Economics in Hamburg, <http://www.ile-hamburg.de/>
- 99.
Riccardo Guastini, ‘Rule-Sceptism Restated’.
- 100.
- 101.
- 102.
- 103.
A fortunate exception are e.g. Yale and Wisconsin, who still pursue a LL.M. training by research and respective close intensive supervision by the law faculty and in Wisconsin even under involvement in the faculty with a view to promote the education of academics.
- 104.
Boudewijn Bouckaert and Gerrit De Geest, Encyclopedia of Law & Economics.
- 105.
See e.g. Cass Sunstein, Free Markets and Social Justice; id., ‘Humanizing’, pp. 3 et seqq.
- 106.
See for the need to involve internal and external analysis of law in European scholarship Hesselink, pp. 20 et seqq.; For the need to combine social justice with free market economy in Europe see Kai Purnhagen, ‘The Architecture of Post-National European Contract Law: A Question of Institutions?’.
- 107.
Ackermann, p. 11 (stipulates that legal science can only be conducted by combining political and systematical arguments); In Kai Purnhagen, ‘The Architecture of Post-National European Contract Law: A Question of Institutions?’, I describe this phenomenon under recourse to Wilhelm Schapp as the proper relationship between the super- and infrastructure.
- 108.
v. Bogdandy, p. 16.
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Purnhagen, K. (2014). Never the Twain Shall Meet?. In: Mathis, K. (eds) Law and Economics in Europe. Economic Analysis of Law in European Legal Scholarship, vol 1. Springer, Dordrecht. https://doi.org/10.1007/978-94-007-7110-9_1
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