Methodological Failures in Leading American Economic Analyses of the Private Law

Shawn Bayern

Abstract


Critics of the American law and economics movement normally sidestep its analysis by emphasizing noninstrumental goals for legal rules or challenging the fundamental assumptions (like the rational-actor model) of legal-economic arguments. These critiques are often valid, but they neglect an equally important problem with much legal-economic reasoning, which is that it is often simply incorrect on its own terms. Too often, legal-economic analyses amount to elaborate restatements of particular disputed legal propositions, depend on an artificial scope of analysis, smuggle in various factual assumptions, and so on. This article demonstrates these problems using a series of examples in American private law.

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