Economic approaches to law
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- Term 1
In this course we explore what economic approaches (concepts, values, facts) can reveal about law. No prior knowledge of economics is necessary. We begin with a basic introduction to some economic concepts (efficiency, maximisation, equilibrium, preferences, ‘marginal’ and ‘opportunity’ costs and benefits); and tools (functions and graphs—e.g. utility or supply functions, indifference curves). We then ask what those concepts and tools might reveal to us about, for example, why we follow the law, and when we are likely to break it; and about the impact of laws and legal institutions on economic activities. The approach is practical (drawing on real life examples) critical (highlighting both the merits and limitations) and contemporary (employing recent innovations, such as behavioural economics; and addressing current events, such as the financial crisis). The course complements the half option Sociological Approaches to Law (15PLAH032) but can be followed independently. No prior knowledge of economics is necessary. Extensive use is made of e-learning tools.
Objectives and learning outcomes of the course
The aims of the course are to introduce the basic principles (maximisation, equilibrium, efficiency, consumer preferences, 'marginal' and 'opportunity' costs and benefits) and tools (functions and graphs eg utility or supply functions, indifference curves) of the economic approach to law and then to apply those principles and tools to a range of issues (globalization, corruption, pollution, access to justice, the use of contracts). The approach will be critical, seeking to identify the merits and limitations of the dominant economic approach to law.
- Knowledge of basic economic principles and mathematical tools
- Understanding of how economic normative, empirical and analytical tools can be used to explain and predict socio-legal phenomena and to choose between laws and institutions.
- Understanding of the limitations of of the dominant economic approach to law.
- Awareness of the existence of multiple economic approaches.
- Legal and philosophical analysis
- Critical reflection
- Interdisciplinary study
- Appreciation of practical outcome from theory
- Interdisciplinary analysis
- Ability to read basic graphs and formulas
Students will be expected to attend one 2 hour lecture over 10 weeks.
Scope and syllabus
Topics covered are likely to include:
- Approaching social life economically
- Economic approaches to law
- Property rights, capital and transaction costs
- Formality and informality
- Markets and market failure
- State intervention and regulation
- Refining homo-economicus
- Case study: Corruption
- Case study: Measuring legal systems
- Case study: Financial crisis
Method of assessment
Assessment weighting: 100% coursework (one 6,000 word essay)
Coursework can be resubmitted.