Fault at the Contract-Tort Interface

The formative period in the history of contract and tort (in the second half of the nineteenth century) may be characterized by the cleavage of contract and tort around the concept of fault: tort modernized by moving from strict liability to a regime of no liability without fault, while contract moved toward strict liability. The opposing attitudes toward fault are puzzling at first glance. Nineteenth-century scholars of private law offered explanations for the opposition, reasoning that alternative ideas about fault account for the different character of state involvement in enforcing private law rights: tort law governs liabilities imposed by law on nonconsenting members of society (and thus, it should limit itself to fault-based conduct), while contract law governs bargained-for duties and liabilities of parties who exercise freedom of contract (and thus, liability voluntarily undertaken need not consider fault). These theories are problematic, especially because they cannot offer a complete account of contract or tort. Tort retains too much strict liability to be thought of as a regime of no liability without fault, and contract has too many fault-based rules to be conceived of through strict liability. While these justifications for the distinction between contract and tort were questioned in ensuing generations, they still structure much of the debate over the current boundary between contract and tort

Economic Analysis in Law

This Essay explores the relationship between normative law and economics and legal theory. We claim that legal theory must account for law’s coerciveness, normativity, and institutional structure. Economic analyses that engage these features are an integral part of legal theory, rather than external observations about law from an economic perspective. These analyses, or economic analysis in law, play a crucial role in understanding the law and in developing legal policy arguments. After establishing economic analysis in law’s terminology, this Essay maps out three contributions of economic analysis in law: prescriptive recommendations in areas amenable to preference satisfaction as a normative criterion, analyzing efficiency as one aspect of a broader normative inquiry, and exposing feasibility constraints. Finally, this Essay turns to an exploration of possibilities for extending economic analysis in law beyond its comfort zone. It suggests that economic analysis might expand into areas where values other than preference satisfaction are or ought to be dominant considerations

Just Prices

In what sense do market prices represent or convey value? At first glance, such prices might look like the upshot of spontaneous social aggregation without exogenously imposed order: uncoordinated individual trading decisions yield price information that is said both to induce socially efficient productive decisions and to set a framework that facilitates coherent and welfare-enhancing consumer choice. But while some trading decisions might well be uncoordinated,far from all of them are; and the rules within which trade is conducted are in any event the product of social choice. When we recognize that these rules of trade and certain public practices of trade affect the terms of trade, we cannot but ask whether the rules, the relevant practices, and the prices they partly produce can underwrite just social arrangements. The shorthand rendition of this question is when are market prices just? In this paper we set out to untangle some of the economic and philosophic issues implicated by this loaded question, and to propose a set of considerations that can aid evaluation of the justice (or otherwise) of market prices

Just Prices

In what sense do market prices represent or convey value? At first glance, such prices might look like the upshot of spontaneous social aggregation without exogenously imposed order: uncoordinated individual trading decisions yield price information that is said both to induce socially efficient productive decisions and to set a framework that facilitates coherent and welfare-enhancing consumer choice. But while some trading decisions might well be uncoordinated,far from all of them are; and the rules within which trade is conducted are in any event the product of social choice. When we recognize that these rules of trade and certain public practices of trade affect the terms of trade, we cannot but ask whether the rules, the relevant practices, and the prices they partly produce can underwrite just social arrangements. The shorthand rendition of this question is when are market prices just? In this paper we set out to untangle some of the economic and philosophic issues implicated by this loaded question, and to propose a set of considerations that can aid evaluation of the justice (or otherwise) of market prices