Law and Economics
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Description
Law and economics have had a long and fruitful intellectual relation. Adam Smith (1723–1790) lectured on jurisprudence well before writing The Wealth of Nations (1776). In many European universities, economics departments emerged from faculties of law. Yet the role of economics in American legal education and in contemporary adjudication in the United States has often been surprisingly limited. Since the emergence of economics as a distinct discipline in the United States in 1885 when the American Economics Association was founded, two great (and distinct) movements integrating legal and economic analysis have occurred. The first movement began in the late nineteenth century and extended to the New Deal. The second movement, generally said to originate with the publication of Ronald Coase’s “The Problem of Social Cost” (1960) and Guido Calabresi’s “Some Thoughts on Risk Distribution and the Law of Torts” (1961), continues in the early twenty-first century. Both movements had a substantial influence on the legal thought of their day; as discussed below, the extent of their influence on the Supreme Court of the United States is difficult to determine. This entry has four parts. First, it briefly discusses how to measure the influence of a decentralized, nonunitary intellectual movement. Next, it considers the first “progressive” movement in economic analysis, providing a brief history of the key participants and substantive issues engaged, as well as an assessment of its influence on the U.S. Supreme Court. The third section provides a brief history of the second, “neoclassical” movement; here the entry emphasizes some of the controversial claims that arose in the early 1970s. The fourth section considers the influence of the neoclassical movement in the economic analysis of law on the Supreme Court because, though influenced by the intellectual currents of its time, the Supreme Court only rarely gives explicit indication of this influence.
Source Publication
Encyclopedia of the Supreme Court of the United States
Source Editors/Authors
David S. Tanenhaus
Publication Date
2008
Volume Number
3: J-O
Recommended Citation
Kornhauser, Lewis A., "Law and Economics" (2008). Faculty Chapters. 1031.
https://gretchen.law.nyu.edu/fac-chapt/1031
