The Economics of Lawmaking

Sources of law have not enjoyed a systematic treatment in the existing law and economics literature. This book aims at coping with this shortcoming, providing some novel insights for the institutional theory of lawmaking. The book considers four different methods of lawmaking, described respectively as: (1) lawmaking through legislation; (2) lawmaking through adjudication; (3) lawmaking through practice; and (4) lawmaking through agreement. The aim of this book is to provide insight on the relative advantages and the respective limits of alternative sources of law. The authors consider some characterizing features of our sources of law and examine them with the aid of the formal methods of economic analysis and public choice theory. The book sheds new light on the important issue of the institutional design of lawmaking, emphasizing the respective advantages and proper scope of application of legislation, judge-made law, customary law, and international law in the creation of a legal order.