Independence from political decision makers

A great deal of literature addresses the puzzle of an independent judiciary: on one hand, the so-called ‘demonopolization theory’ suggests a normative ex­planation based on an analogy with antitrust law; on the other, the law and economics and political economy literature favours a positive approach along the lines of the rational choice paradigm.

The demonopolization theory

Directly related to the view initially developed by constitutional framers and historically embodied in constitutional writings, the theory of the demonopo­lization of power considers the government as an initial monopolist in the political market whose possible abuses of power must be thwarted and coun­terbalanced by specific mechanisms. Consequently, a system of checks and balances must be put in place in order to allow a competitive situation to emerge. From this perspective, the separation of powers is aimed at balancing and controlling the different branches of government. Accordingly, an institu­tionally distinct and independent judiciary stands as the guardian of public interest and fundamental rights against possible attacks by other branches of government. Insulated from the political process, judges are expected to act as impartial agents making the right decisions according to the democratic values that underlie the constitution. Thus, independence and the power to declare legislative and executive decisions unconstitutional allow them to limit rent-seeking activities by interest groups (Downs, 1957; Buchanan and Tullock, 1962; Buchanan, 1975; Epstein, 1987; Macey, 1988; Mashaw, 1990).

Law and economics models

Since it relies on a somewhat idealistic conception of the judiciary as a protection against private interests, the previous theory may run afoul of the standard assumptions of economic theory. By contrast, the law and econo­mist’s analyses try to reconcile judicial independence with the rational choice paradigm.

Contingent on judicial objectives, various outcomes may be expected in terms of independence. In this respect, no conclusive consensus prevails in the theory with regard to judicial objectives and their effect on independence. Several empirical tests, mainly focusing on the US system, lead to contrast­ing evidence. Testing the correlation between salaries and the content of judicial decisions, Anderson et al. (1989) find a positive correlation between the independence of judges, measured by the number of overturned regula­tions and statutes, and the level of their salaries. In contrast, Toma (1991) establishes a positive correlation between the level of the budget received by the US Supreme Court and the proximity of its decisions to the preferences of the Congress. Testing whether the prospect of promotion may limit judicial independence, Higgins and Rubin (1980) claim that although high reversal levels lower the judge’s chance of promotion, the effects of promotion are very limited. In particular, they find that the decisions of older judges are not overturned more frequently than young ones, whereas the former could be expected to decide more according to their own preferences than according to their promotion prospects. Ashenfelter et al. (1995) confirm this result in establishing no significant relationship between case outcomes and an ap­pointing president’s ideology.

Whatever their objectives, the maximization of their utility by rational judges makes them responsive to political control through the manipulation of traditional incentive and compensation systems by other branches of govern­ment. In that view, the judiciary is a specific form of bureaucracy for which traditional incentives are effective, under the form of either ex ante selection or ex post monitoring. Political control may then take either a political or an administrative form, each creating different incentives for judges and, there­fore, inducing them to different behaviours (Elder, 1987). Within this framework, the question of the contribution of political decision makers to judicial independence, or why they organize and respect independent courts while they have structural means available to influence judicial decision­making is of the utmost importance.

The law and economics literature suggests several explanations for the possible discrepancy between structural and substantive independence.

Building upon the Landes-Posner analysis, Ramseyer (1994) questions the ‘puzzle’ of the various levels of independence among national judiciaries. Towards that end, he models the electoral game as a sequential one affected by uncertainty about the electoral outcome. Using a repeated prisoner’s dilemma game, Ramseyer shows that a politician in office and expecting to stay in power during several consecutive legislative terms has an incentive to cheat on judicial independence but has an interest in an independent judiciary when he/she is not in office. Therefore, rational politicians will find it advan­tageous to contribute to independence when they fear losing elections but will rather defect when they expect to win them indefinitely. In other words, the preservation of independence will result from an intertemporal calculus through which political decision makers agree to increase their control over the judiciary in the future by decreasing their control in the present. Finally, the expected degree of political stability (will elections continue indefinitely or not?) and the likelihood of winning the elections (political turnover and competitiveness of the political market) will determine politicians’ contribu­tion to independence. Within this analysis, independent courts represent a cooperative equilibrium to the game, but not a unique one, and cooperation will be very sensitive to the threats of defection and non-reciprocity.

However, the interest-group theory of judicial independence faces several limitations and criticisms. On the one hand, the empirical tests of the theory appear inconclusive. While Landes and Posner (1975) do not find any evi­dence corroborating their own theory, North and Weingast (1989) provide evidence for seventeenth-century England. Crain and Tollison (1979a) find that the interest-group theory of an independent judiciary explains the pro­duction of constitutional amendments as a function of legislative and judicial organizations relatively well. Arguing that a constitutional amendment pro­vides a particularly durable type of long-term interest-group legislation due to its high cost of repeal, and using the tenure of the chief justice of a state’s highest court as a proxy for judicial independence, they test the process of constitutional change across state governments in the United States. They find that the more independent the judiciary, the fewer the number of consti­tutional amendments. Drawing an analogy between the executive veto and the independent judiciary, Crain and Tollison (1979b) show that, like inde­pendent courts, the veto power enhances the durability of legislation and, therefore, increases the returns from legislative contracts with special inter­ests by making these contracts harder to renege on.

Yet several authors doubt that such a consensus favouring the original legislative intent exists among judges (Macey, 1988, 1994; Epstein, 1990; Boudreaux and Pritchard, 1994). Pointing out the absence of credible mecha­nisms originated by politicians and intended to make judges enforce past deals, they contend that courts may be more responsive to the expectations of the current legislature rather than willing to issue decisions that please past legislatures. As a consequence, the judiciary may lack the collective incentive to produce independent decisions and may individually have an incentive to free ride, that is, to make decisions consistent with the preferences of the current politicians. Similarly, fearing that the political decision makers in office at the last period may defect, current legislators may not be willing to forgo lucrative political deals and reward courts for their independence. In other words, an iterated prisoner’s dilemma game without the ability to sanction future legislators will lead to intertemporal free-riding and underinvestment in the contribution to judicial independence. The fact that the rents available from manipulating past legislative contracts may be far greater than those from new deals, due to the respective number of contracts of both types, coupled with the public choice assumption of short-term pre­occupied politicians, underpin the argument. Finally, arguing that the most powerful obstacle to dependent decisions resides mainly in its cost in terms of reputation within the judicial audience and scholarship, Boudreaux and Pritchard (1994) conclude that a more traditional vision of judicial indepen­dence as serving the long-term public good and based on the genuine convictions of framers might be as justified as the Landes-Posner interest-group theory.

A second explanation for the independence of the judiciary relies on the interest of politicians to maintain independent courts to which they can delegate legislative and other public decision-making powers (Voigt and Salzberger, 2002). Extending the contribution of the literature on the delega­tion of decision-making powers to administrative agencies, Salzberger (1993) argues that - besides traditional motives invoked to justify delegation, such as the lack of time or expertise and the need for decisiveness and anti-cycling procedures - delegation to independent courts may help politicians to maxi­mize their political support and chance of re-election. Indeed, delegation may enable the politicians to shift responsibility for unpopular decisions onto the courts. Since at the same time, they may continue to claim the credit for those decisions from those among whom they are popular, delegation may thus help to find a compromise between legislators whose constituencies respec­tively win and lose from the decision. Furthermore, compared to other possible delegatee bodies, courts allow the politicians to transfer responsibility all the more easily since judges are perceived as independent. Building further along similar lines, Josselin and Marciano (2001) consider the constitution as an incomplete contract between citizens (principals) and politicians (agents) requiring delegation to the courts in order to fill gaps in constitutional ar­rangements and produce rules in the presence of an ‘open area’ of the law (Posner, 1999). To that extent, delegation partly accounts for the ‘judicialization’ tendency and judicial empowerment in sensitive political debates (Hirschl, 2000).

In addition to this delegation motive, a third reason for political decision makers to contribute to judicial independence resides in the informational benefits provided by independent judicial review. Namely, for institutional as well as chronological reasons, courts have an informational advantage con­cerning the actual consequences of enacted legislation relative to legislators themselves when they initially passed it. An independent judiciary therefore conveys information to legislators that they cannot acquire through the nor­mal legislative proceedings, which in turn affects the quantity and informational quality of legislation (Rogers, 2001). Similarly, independent courts play an informational key role in the relation between political decision makers and public bureaucrats. By providing politicians with information about the actual bureaucratic performance, they assist them in controlling their bureaucracies and, thereby, in gaining electoral support (McCubbins and Schwartz, 1984; Ferejohn and Shipan, 1990; Gely and Spiller, 1990).

A fourth line of explanation resorting to law and economics analyses highlights public support for judicial independence as a key factor for ex­plaining the political contribution to independence. The reasons behind this are twofold. On the one hand, when independent courts enjoy a high level of public support, political attempts to infringe upon judicial independence may turn out costly in terms of political support. Therefore, the fear of electoral sanctions may induce politicians to enforce judicial decisions. Thus, they may be all the more willing to respect independence since the probability and cost of a sanction are high; this happens when voters are able to effectively monitor political responses to judicial decisions, and may explain why other branches of government comply with judicial rulings made by constitutional courts (Vanberg, 2000, 2001). On the other hand, beyond the obvious elec­toral gain associated with a situation that is valued and praised by voters, judicial independence brings several advantages for political decision makers and facilitates their activity. Since independence leads to greater acceptance and respect of judicial rulings among the public, it decreases the cost of their enforcement and makes the administration ofjustice less costly. More broadly, independent courts are also expected to enhance the general legitimacy of all political decisions and to make their implementation easier (Boudreaux and Pritchard, 1994).

The Political Economy literature

Also building upon the rational choice paradigm, the political economy literature develops a general equilibrium model of checks and balances to analyse strategic interactions between the branches of government. However, by contrast with law and economics analyses, it initially focuses on the executive-legislative relationship and on the role of voters and interest groups within this framework, at the expense of the role of an independent judiciary. Pointing out this shortcut in the political economy approach as well as the restrictive partial equilibrium dimension of law and economics models, Padovano et al. (2003) propose to reconcile the two approaches and explicitly introduce self-interested courts into Persson et al.’s (1997) model of separa­tion of powers. Comparing the impact of a respectively dependent and independent judicial branch on the accountability of a democratic govern­ment, they conclude that independent courts improve political accountability whereas a dependent judiciary alters the distribution of political rents without improving the accountability of the system.

Independence versus judicial discretion

Also assuming rationality and self-interested judges, the spatial models of judicial discretion focus on the institutional constraints that weigh on judicial action. Borrowing from the positive political economy analysis of adminis­trative agencies (Weingast, 1984; McCubbins et al., 1987, 1989; Hammond and Knott, 1996), they consider that the different preferences of political decision makers over the policy space shape a discretion interval for courts. As long as political actors holding veto powers disagree about a simulta­neously preferred solution, they are not induced to veto judicial decisions. Whenever courts make their decisions strategically and retreat from politi­cally untenable positions, they are able to avoid reversal. The set of veto-proof solutions will thus measure the range of judicial discretion. Therefore, the ability of a court to make stable decisions derives not from the grant of independence guarantees to the judiciary by framers or legislatures, but rather from the possibility of making decisions that are also structure-induced equilibria.

Within this framework, the judiciary can be analysed as any public agency subject to institutional constraints and the notion of judicial discretion substi­tutes for the notion of independence to explain most observed judicial behaviours (Ferejohn and Weingast, 1992). For instance, judicial activism is seen as the outcome of a wide set of possible decisions that are made possible by the dissenting preferences of the other institutional players. By contrast, restrained behaviours of courts are motivated by a narrow set of feasible decisions shaped by the other actors’ preferences. According to that view, a ‘shy’ decision by a judge simply results from his/her expectation of a reversal when making another decision or, in other words, is simply the hallmark of rational self-restraint. Empirical studies corroborate this expected influence of the institutional structure on judicial discretion whenever courts take into account politicians’ preferences and the threat of a veto. For instance, Gely and Spiller (1990, 1992) and Spiller and Gely (1992) find that the choices of the US Supreme Court are actually constrained by Congress. Cooter and Drexl (1994) study the impact of the evolution of the decisional procedures in the European Community in relation to the discretionary power of courts and verify the main results of the spatial theory. Using a panel of many countries, Cooter and Ginsburg (1996) also find a positive correlation between judicial independence and the number of institutional vetoes framing the political process.

In spite of a few notable exceptions, most of the aforementioned analyses focus on the American setting, in particular on the US Supreme Court. Albeit developing, the analysis of the organization of an independent judiciary in civil law systems is less advanced than in common law regimes, although it obviously provides an important leeway for political intervention. According to the conception of adjudication prevailing in the country, the organization of the judiciary may also convey different implications in terms of judicial independence from the litigants.