Principles of Law & Economics

Why do we allow parties to a contract to breach their obligations? Do criminal law penalties adequately disincentivize certain behaviors? The Law & Economics academic movement sought to answer these questions, and more, and therefore test the boundaries of using legal policy to promote the efficient production and allocation of resources and consequently the maximization of social welfare. This course offers an introduction to the study of Law & Economics. Principally, we will focus on the core bodies of law taught to first-year law students tort law, contract law, property law, and criminal law as well as other areas in which the law impacts human behavior. For each of these bodies of law, the economic approach will be described in non-technical terms, and then this approach will be used to examine issues within that body of law. We will also develop some elementary economic techniques, guided by economic theory. By the end of this course you will be able to use these and other techniques to: assess the economic efficiency of legal rules; analyze how the legal regimes affect economic efficiency; and demonstrate how the assignment of risk alters perceptions of value, among other applications. But above all, you will be able to apply them in three reflection papers on topics of your choosing, as well as a final presentation, which should go beyond mere description to apply the methods of Law & Economics to critically evaluate some rule, regulation, or customary legal practice.