Contents

List of figures ix

List of tables x

List of contributors xi

Introduction 1

Jurgen G. Backhaus

PART I BASICS OF THE LAW AND ECONOMICS APPROACH

1 Coase theorem and transaction cost economics in the law 7

Francesco Parisi

2 Property rights and their partitioning 40

Christian Muller and Manfred Tietzel

3 Legal change in economic analysis 53

John N.

4 Positive, normative and functional schools in law and economics 58

Francesco Parisi

5 Commons and anticommons 74

Francesco Parisi and Ben Depoorter

PART II PRIVATE LAW AND ECONOMICS

6 The economics of tort law 87

Giuseppe Dari Mattiacci and Francesco Parisi

7 Family 103

Margaret Brinig

8 Inheritance 119

Richard E. Wagner

9 Intellectual property and the markets of ideas 127

Giovanni B. Ramello

10 Incomplete contracts and institutions 145

Antonio Nicita and Ugo Pagano

PART III PUBLIC LAW AND ECONOMICS

11 Central bank 165

Zeljko Sevic

12 Constitutional economics I 184

Francesco Farina

13 Constitutional economics II 223

Ludwig Van den Hauwe

14 Administrative law and economics 239

Jean-Michel Josselin and Alain Marciano

15 Property 246

Thomas J. Miceli

16 The European Union’s institutional design 261

Elisabetta Croci Angelini

17 Subsidiarity 280

Jurgen G. Backhaus

PART IV LABOUR LAW AND ECONOMICS

18 Labour contracts 289

Don Bellante

19 Company board representation 297

Jurgen G. Backhaus

20 Employment security through dismissal protection: market versus

policy failures 311

Christoph F. Buechtemann and Ulrich Walwei

PART V REGULATION, TAXATION AND PUBLIC ENTERPRISE

21 Structures of public enterprise 329

Jurgen G. Backhaus

22 Environmental law and economics 345

A. Allan Schmid

23 Environmental policies choice as an issue of informational

efficiency 350

Donatella Porrini

24 Tradable emission rights 364

Edwin Woerdman

25 Regulatory taxation 381

Jurgen G.

PART VI DISPUTE RESOLUTION

26 Dispute resolution 393

Thomas J. Miceli

Contents vii

PART VII DIFFERENT SOURCES OF THE LAW

27 Judicial independence 407

Sophie Harnay

28 General norms and customs 424

Jean-Michel Josselin and Alain Marciano

29 Science as a source of law 433

Peter R. Senn

30 Social science as a source of the law 442

Peter R. Senn

31 Cognitive science 453

John N. Drobak

32 Connections with law and society research 459

Jurgen G. Backhaus

PART VIII TOWARDS AN IDEAL ECONOMIC ANALYSIS OF A LEGAL PROBLEM

33 Towards an ideal economic analysis of a legal problem 465

Jurgen G. Backhaus

PART IX CLASSICAL AUTHORS IN LAW AND ECONOMICS

34 Cesare Beccaria (1738-94) 475

Francesco Parisi and Giampaolo Frezza

35 Franz Bohm (1895-1977) 489

Heinz Grossekettler

36 John R. Commons (1862-1945) 499

Warren J. Samuels

37 Walter Eucken (1891-1950) 508

Leland B. Yeager

38 Otto von Gierke (1841-1921) 519

Jurgen G. Backhaus

39 Augusto Graziani (1865-1938) 522

Giampaolo Frezza and Francesco Parisi

40 Robert Lee Hale (1884-1969) - legal economist 531

Nicholas Mercuro, Steven G. Medema and Warren J. Samuels

41 Friedrich August von Hayek (1899-1992) 545

Ludwig Van den Hauwe

42 Theodor Herzl (1860-1904) 559

Peter R. Senn

viii The Elgar companion to law and economics

43 Rudolf von Jhering (1818-92) and the economics of justice 568

J.L.M. Elders

44 Franz Klein (1854-1926) 576

Peter Lewisch

45 Etienne Laspeyres (1834-1913) 585

Wolfgang Drechsler

46 Friedrich List (1789-1846) 590

Arno Mong Daastol

47 Achille Loria (1857-1943) 607

Giampaolo Frezza and Francesco Parisi

48 Karl Marx (1818-83) and Friedrich Engels (1820-95) 618

Heath Pearson

49 Carl Menger (1840-1921) 627

Richard E. Wagner

50 Plato (c. 427-349 bc) 635

Wolfgang Drechsler

51 Wilhelm Roscher (1817-94) 642

Erich Streissler

52 Emil Sax (1845-1927) 652

Manfred Prisching

53 Gustav von Schmoller (1838-1917) 662

Helge Peukert

54 Adam Smith (1723-90) 672

Helge Peukert

55 Werner Sombart (1863-1941) 683

Gunther Chaloupek

56 Lorenz von Stein (1815-90) 689

Heinz Grossekettler

57 George Joseph Stigler (1911-92) 700

Peter R.

58 Pietro Trimarchi (1934-) 709

Giampaolo Frezza and Francesco Parisi

59 Thorstein Veblen (1857-1929) 727

Heath Pearson

60 Max Weber (1864-1920) 733

Helge Peukert

61 Christian Wolff (1679-1754) 745

Wolfgang Drechsler

Index

751

Figures

5.1 Game matrix 79

10.1 The unilateral hold-up problem 149

10.2 The bilateral hold-up problem 149

12.1 Role of institutions in economic integration 214

13.1 Classic prisoner’s dilemma 229

13.2 Modified prisoner’s dilemma 233

16.1 Pay-off matrix of the EU 274

16.2 Games: pay-off matrices 276

16.3 Games: tied hands matrices 278

23.1 Scheme of different environmental policy instruments 351

32.1 Sombart’s modern capitalism 460

ix

Tables

7.1 A systematic representation of family law 104

15.1 Optimal remedies for externalities 251

16.1 Features of EU institutional bodies 264

19.1 Codetermination as an interlocking system 297

21.1 The Treuhand legacy 329

33.1 Different approaches to law and economics 468