New Perspectives on Law and Institutions in Europe
New Horizons in Law and Economics series
Edited by Alain Marciano and Jean-Michel Josselin
Chapter 1: Introduction: Co-ordinating demand and supply of law: Market forces or state control?
Jean-Michel Josselin and Alain Marciano INTRODUCTION The idea that competition plays an important role in the provision of law has gained an indisputable legitimacy among economists. It does not only convey the acknowledgement of the influence of rules and institutions on economic competition, but also that governments, when institutional competition is at stake, or legal producers, in the case of legal competition, are rivals and compete just like producers of goods and services compete in usual markets. In other words, if we admit that rules are goods that must be produced (and not simply discovered by judges), then their provision must be organized according to market mechanisms. Thus, legal competition, as a decentralized market process of provision of law in which legal clubs compete, can be contrasted with a monopolist and centralized lawmaking process, mainly backed up by the coercive power of the State. Even if the contrast between these two models is not so neat in reality, where practices mix with reasoned arguments, these approaches nonetheless constitute two theoretical references that allow us to understand and to model many important situations in which new institutions have to be elaborated. Besides the building of new legal systems in the former communist countries or the provision of law in cyberspace, the harmonization of law related to the European integration process is certainly one of the major issues to be discussed. This is the focus of the chapters presented in this volume. The example of the European Union is all the more...