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Geddis, A --- "Frontiers of Legal Theory" [2003] OtaLawRw 12; (2003) 10 Otago Law Review 457

Frontiers of Legal Theory

(By Richard Posner, Harvard University Press, 2001)

This is a review of a book[1] that deploys “cost-benefit analysis” and “rational choice theory” in an effort to provide an explanation for a variety of social phenomena found both inside and outside of the Law. Therefore, before I start discussing the various merits and shortcomings of the work, it is as well to clarify what these types of inquiry entail. I could do this by offering up a dictionary definition of the terms,[2] or by telling the reader what the author of the work under review thinks the terms mean.[3] But, I hear you say, where’s the fun in that? And so instead I choose to employ the venerable style of “authorial confession”[4] and begin this review by illustrating these two forms of analysis through the means of a (rather lengthy) personal anecdote.

1: Why Do Students Bother To Attend Their Lectures?

For the last three years I have taught a part of the compulsory Contract Law course to second year law students at Otago University. In the course of this teaching, I have noticed a fact which, I am sure, is familiar to every other teacher of law (if not every other teacher, full stop). If I tell the class that a lecture to be given on a certain day will cover material that will not then be examined, I can be assured that a large proportion of the class – usually more than 50 percent – will not attend on that particular day. Conversely, by announcing that, on a certain day, I will outline the questions that will be asked in the final exam, I can be assured of an almost total turnout to that lecture. What can explain this phenomenon? Is it just, as some of my colleagues are fond of saying, that students are “lazy little buggers?”[5] Or is there another explanation available for their behaviour?

Consider this. Going to one of my lectures requires a student to devote an hour of her time to that end, time which is not then available for any other purpose. The extent to which this time commitment represents a “cost” will vary for each individual student in the class, and for different reasons. For instance, some will have to engage in part-time paid employment in order to pay for their tuition fees and living expenses, and so an hour spent at my lecture is an hour of wages forgone. (A purely economic cost). Others will have very little interest in either the subject matter of Contract Law – for some extraordinary reason they find topics such as exclusion clauses and recission less than gripping – or the way in which I present it, and so attending my lecture is a guarantee of an hour of boredom. (A cost in terms of psychic pleasure or happiness). Even so, the “average cost” of attendance – the sum of all the various individual costs that would be incurred in attending my lecture by all the enrolled students, divided by the number of enrolled students – can be expected to remain relatively static from week to week. Thus it is, on average, no more costly in terms of the time committed for a student to go to a lecture where the material will not be examined than it is to go to one where the exam questions will be announced.[6]

What does vary between the two lectures, however, is the benefit that a student expects to gain from the hour. In the first scenario, the expected benefit for a student attending class is hearing me lecture on some topic for an hour, thereby providing him with a (surely heavily discounted!) chance of “gaining knowledge for knowledge’s sake”. In the second class, the pay-off to a student includes this, plus an insight into the range of material that she will have to be able to demonstrate some knowledge of in the end of year examination. Gaining this information helps the student in preparing for the exam: it saves the student the future cost in time and effort of revising material which she will not then be required to demonstrate a knowledge of. In turn, this can help the student to gain a better grade (by allowing her to focus her time and effort on studying those areas on which she will be questioned), or can help her obtain the same grade for a lesser exertion of effort (by enabling her to spend the night before the exam learning the names of the cases that relate to the areas that will be examined, thereby getting the C- grade (or “C dash”, in student terminology) needed to pass the course).

Therefore, the difference in class attendance between the two lectures can be explained in terms of a rational choice made by each student following a (mostly unconscious) cost-benefit analysis of the time commitments involved.[7] Where a lecture only promises a benefit of “knowledge for knowledge’s sake”, then the cost in time of attending the lecture will (for many of the students) be greater than that benefit. But where a lecture promises the additional benefit of information about the assessment tasks that will be required of them at the end of year, then the cost in time of attending the lecture will (for almost all the students) be lower than that benefit. While this is still only a very crude and simplified analysis – it does not explain why so many students experience 60 minutes of my teaching as a cost not outweighed by the chance of “gaining knowledge for knowledge’s sake”[8] – it does serve as a useful heuristic device with which to study the issue.

But in what sense is it “useful”?[9] I suggest there is an immediately pertinent reason why a teacher should recognise the place of this kind of thinking in student decision making. Simply put, it can enable a teacher to manipulate lecture attendance to his own ends. Hence, if you want to generate a class on a particular day which is comprised of students who value the benefit of gaining “knowledge for knowledge’s sake” more highly than the time cost of attendance, then you simply announce that the subject matter of that particular lecture will not be examinable. Such lectures are ideal for administering the student teaching evaluations needed for promotion, as those students who place a low value on your teaching (as they have heavily discounted the chance that they will learn anything at all from you), or who find that it imposes a high cost on them (as they have no interest in the subject matter, and are thus quickly bored), will not generally be in attendance.[10] Contrariwise, if you want to generate a class on a particular day containing virtually all of those who are enrolled in the course, then you should announce that you will be discussing the exam questions at the end of that lecture. Such a technique (ruse?) is ideal for flattering the vanity of visiting lecturers, by leading them to believe that the large student turnout results from genuine interest in what the lecturer has to say upon some subject.

2: Law and Economics: Its Methodology and Its Critics.

The above story serves to illustrate three points which will be important throughout this review – and yes, I will get to the book itself before long. Firstly, whether consciously carried out or not, all students perform a balancing exercise in deciding if they will attend a particular lecture, in which all their perceived costs of attendance are set off against all the perceived benefits to be gained. Extrapolating from this example, “cost-benefit analysis” assumes that all people always conduct this form of balancing exercise before deciding how to act. Secondly, in deciding whether to attend or not, students will act “rationally” in the sense that they will only go to class if the perceived benefits of doing so outweigh the perceived costs. Again, “rational choice theory” extrapolates from this insight to claim that all people will always choose to act in the way that most benefits them, in the sense of accomplishes their preferred outcome in the most efficient way. Finally, knowledge about the reasoning process of students can allow for manipulation of student behaviour, through raising or lowering the expected benefits of attendance. Here a normative element is introduced into the account – for it may then be asked when, and to what ends, should this manipulation of behaviour occur?

All of which is all very well. But does this account really tell us anything novel? After all, the forms of reasoning outlined above have their biblical[11] and Shakespearian[12] antecedents. What is noteworthy, however, is the way this sort of cost-benefit analysis and rational choice theory has been widely and systematically applied over the past three decades to an ever-widening array of social issues. Within the field of the law, this approach – pioneered in no small part by Richard Posner himself[13] – has been given the now ubiquitous sobriquet of “Law and Economics”.[14] From its beginnings in Ronald Coase’s article on social cost,[15] and Guido Calabresi’s first application of cost-benefit analysis to tort law,[16] the Law and Economics programme has proceeded to sweep through areas as diverse as family law,[17] corporate law,[18] criminal law,[19] employment,[20] and environmental law[21] – to name but a slice.[22] The programme has had considerable success in influencing legal scholarship and judicial decision making – particularly in the United States,[23] but to a lesser extent also here in New Zealand.[24]

At the same time, it has generated much criticism.[25] Some of this faultfinding has been directed against the substantive policy recommendations generated by the application of the Law and Economics programme to social problems. Here again Richard Posner serves as an ideal poster boy. In an article written with Elizabeth Landes in 1978,[26] he suggested that the shortage of “desirable” (or “healthy, white”) babies available for adoption in the United States could best be solved by allowing desiring parents to purchase the right to parent a particular child directly from a pregnant women. Not surprisingly, this proposal generated a storm of unfavourable comment.[27] But in addition to critiques of the particular policy advice given by proponents of the Law and Economics methodology, there have also been a raft of challenges laid down to the adequacy of the very methodology itself.[28] Simply put, it is argued that the use of cost-benefit analysis and rational choice theory alone provides an insufficient means to understand the world and the people in it,[29] and hence cannot be relied upon either to reveal the “real truth” about social phenomena, or to provide us with acceptable policy proposals.

This methodological critique proceeds along several vectors. The claim that all persons make decisions on how to act based upon a rational assessment of how to satisfy their preferences, and following a weighing up of the individual costs and benefits of those actions, is condemned as being too crudely reductionist. It is argued that such an approach inappropriately conflates a wide range of human values,[30] and seeks to turn irreducibly social phenomena into matters of individual taste. It also seems unable to account for many forms of real-world human activity, where the cost of acting is far in excess of any potential benefit to be gained by the individual actor.[31] This criticism of the Law and Economics programme as “unrealistic” echoes another: that the model of the “rational actor” relied upon to explain how individuals will make choices does not accurately describe people’s actual cognitive processes.[32] Law and Economics also stands accused of failing to provide a coherent basis for assessing the moral desirability of any form of human activity. Because its portrayal of human motivation is based upon the efficient satisfaction of individual preferences, it does not address either the original pattern of distribution of resources within a given society, nor the overall question of whether any set of individual preferences ought to be satisfied. At most, the Law and Economics programme can only attach the label “good” to a course of action in a way which means “efficient (given the way that resources and preferences are distributed at the present moment).”

The net effect of such criticism varies. Some have seized the fumble and sought to return it for a touchdown, by arguing that the entire programme ought to be totally excluded from legal analysis.[33] Others have allowed it merely to chasten their ambitions, so that instead of providing an entire explanation for human activity, Law and Economics should only be seen as a partial and subsidiary account of legal and social phenomena.[34] But amongst the programme’s “true believers”, efforts have been made to defend Law and Economics against the types of critique noted above, and even to launch a counter-offensive designed to extend its influence upon contemporary legal and social thinking.[35] It is into this last camp that Richard Posner’s latest book falls, and it is to this work that I now at last turn.

3: At The Frontiers of Legal Theory, with Richard Posner as our guide.

Richard Posner’s Frontiers of Legal Theory deals with five “external” disciplines which he regards as having “much to contribute to the understanding and improvement of law.”[36] Thus the book presents us with the views of a legal “insider” on the usefulness of several “outsider” perspectives on the law. This pragmatic concept of “useful” frequently re-emerges in Posner’s work, and more shall be said about it later, but for now it is enough to note that the disciplines are considered to have value for the study of law because they can provide the sort of knowledge about the legal system which cannot be gleaned from the conventional analytic techniques utilised when “doing law”.[37] Posner has adjudged that economics, history, psychology, epistemology, and “statistical inference” (which he also calls “empiricism”) meet this criteria, with the book devoting a part to each. That being said, while all these five disciplines qualify as useful, as opposed to the more “vacuous” forms of legal theorising practiced by many legal academics,[38] it is clear that some disciplines are more useful than others. Indeed, as Posner himself admits,[39] the discipline of economics enjoys the status of primes inter pares throughout this book.

Before delving into the book’s actual content, however, let me note at the outset that the work suffers from two flaws inherent in the way it came into being. First of all, the material collected here has previously appeared in article form (the list of publishing acknowledgments runs to two pages.) While there is nothing inherently wrong with this type of academic recycling – no doubt Posner would tell us it is an efficient, and therefore desirable, move as it cuts down on the information-gathering costs that would otherwise be incurred by the reader – it can give a book something of a disjointed and episodic feel, as it does here. Thus each section really presents a collection of related observations and comments on the discipline in question, rather than a fully developed, systematic exploration of the subject. A reader hoping for a comprehensive overview of how each of these five disciplines relates to and illuminates the practice and purpose of law will therefore emerge somewhat disappointed from Posner’s tour of the law’s frontiers.

This point neatly segues into the book’s second flaw. Even by Posner’s own standards, the array of subject matter traversed is as deep as it is broad. The sheer variety of topics covered means that instead of laying out his own independent views of the relevance and applicability of each discipline to the law, much of the book consists of Posner’s summary and critique of the work done by others in the field. Admittedly, much of this is lucid and revealing – I have not seen a better summary of the current debate over the role that the Courts in the U.S. ought to play in judicially reviewing legislative actions than that provided on pages 15-27. Sometimes, however, it is not exactly clear why we are being made privy to Posner’s thoughts on a particular issue – his commentary on the various discussions of the meaning of “cost-benefit analysis” in chapter 3 is particularly opaque. I do not claim that there is necessarily anything wrong with Posner telling us what he thinks about what others have said on particular topics. But it does make the book more of a polemic against the folly of others, rather than a defence of Posner’s own views on the matters covered. This will not come as a surprise to those who have read any of Posner’s previous, and remarkably prodigious, output. He is clearly a thinker who is more attracted to rhetoric than to proof, to argument for argument’s sake instead of carefully testing each and every proposition against possible rebuttal. At its best this can make for a highly entertaining read.[40] At its worst it can make his work seem maddeningly simple-minded, and his criticisms of others rather mean spirited.

What, then, of the book’s actual content? Part One deals with our old friend “Law and Economics”. Chapter one presents little more than a recap and a defence of the development on the Law and Economics programme, with special emphasis put upon the question of what debt (if any) this programme owes to Jeremy Bentham’s utilitarian ethics and jurisprudence. Interesting as this exercise in intellectual archaeology is, the chapter’s main value lies in its restatement of intent: “[The] use of economics ought to be welcomed by lawyers who think it important to discover what the actual consequences of legal doctrines and institutions are, even if those doctrines and institutions have achieved sacred cow status within the legal profession.”[41] Posner then pulls out the economist’s tool of cost-benefit analysis in chapter two to examine one of the United States’ holiest bovines: the constitutional right to Freedom of Speech. Not surprisingly, he argues (pace Justice Holmes in Schenck v. United States[42]) for a purely consequentialist approach to the issue. Thus the question as to whether or not the state ought to be able to restrict some form of speech should be answered purely through a weighing of the costs and benefits involved either in regulating the speech, or in not regulating it.[43]

As an aside, in this chapter Posner subtly places a thumb on the scales so as to tip them toward the regulatory regime that he most prefers.[44] He admits (pages 69-70) that any “offence” caused by some speech has to be considered a “harm” which ought to be taken into account when deciding whether or not to regulate that speech. But then (pages 78-79) he deeply discounts the value that should be ascribed to that “harm”, as causing offence is an integral part of the – socially “useful”, thus beneficial – process of challenging deeply held social ideas. Hence, speech which merely upsets or shocks some people’s sense of decency or propriety ought not, in the absence of any other type of social harm, to be subject to regulation by the state.[45] While portraying this outcome as the purely neutral consequence of applying cost-benefit analysis to the problem, his approach rather ignores the claims of those social conservatives whose very point is that they do not think that some deeply held social views – deeply held because they are morally the “right” ones – ought to be open to challenge in the first place. Therefore, they would argue, the harm that is caused is not simply that they are offended by the speech as individuals, but that the speech may actually be successful in causing social mores – the “morally right” ones – to be altered.

Chapter three moves to consider one of the fundamental challenges to the methodology of the Law and Economics programme. Why, as a normative matter, ought we seek to maximise some particular outcome – be it wealth, or happiness, or any other end-good – in the most efficient manner? Maximising some outcome tells us nothing about its distribution amongst individual persons, and the way that the outcome is distributed will often heavily depend upon the initial entitlements and allocations held by each individual. Hence social programmes that seek to maximise wealth – as well as legal rules designed to this end, such as are advocated by many Law and Economics thinkers[46] – will also result in widely disparate individual wealth holdings, and those holdings will in turn largely be determined by each individual’s resources at the outset of the programme’s implementation.[47] Whether this resultant pattern of distribution is “fair” (or desirable, or just, or whatever you care to term it) is a separate question, one which cannot be answered solely in terms of efficiency or total outcomes. Consider, for example, Ursula Le Guin’s classic story about “Omelas”:[48] a land that has achieved almost perfect happiness for all of its citizens by imprisoning, and horribly mistreating, a single child. How do we decide if such a society is one that we want to attempt to bring about, or to emulate?

In responding to this critique, Posner moves away from the Law and Economics programme’s classical utilitarian underpinnings to embrace a more “pragmatic” defence of outcome maximisation, in particular wealth maximisation.[49] He argues that this ought to be the goal for decision makers as countries with a higher overall level of wealth (but great income inequality) exhibit more social cohesion, and greater political stability,[50] than those with a lower overall level of wealth (but a relatively flat spread of income).[51] Simply put, income inequality does not seem to stop societies from “working” well, while an overall lack of wealth does seem to have this effect. Therefore, Posner argues, wealth maximisation provides a more pragmatically “useful” social end-goal for policy makers than does concern about the growth of inequality.

We have already seen, in examining the criteria by which Posner selected the five disciplines for current discussion, that the test of pragmatic “usefulness” plays a multi-faceted role in Posner’s thinking.[52] This point is further illustrated in Part Two. Posner’s discussion here of the role that history can play in legal thinking is, to my mind, the weakest part of the whole book. Overall it seems to be little more than an extended version of Oliver Wendell Holmes’ famous observation that “it is revolting to have no better reason for a rule of law than that so it was laid down in the time of Henry IV”,[53] put forward under the guise of a meditation on Nietzsche’s theory of history. However, the whole thing comes across as horribly muddled. At some points in this part Posner chastises those who would seek to describe the current law by means of reference to the past. (Bruce Ackerman comes in for a real telling off on this point, as well as being made the target for the best line in the book: “He is playing in his own sandbox, yet playing badly.”)[54] At other points, however, Posner acknowledges that the “path dependency” of the law restricts the range of legal outcomes that can be reached – as, indeed, he must as a judge who is all too aware of the restraints that precedent place upon his decision-making powers.[55] His overall point is no more than that history is just another tool of social analysis, the usefulness of which is determined by the extent to which it can serve pragmatic social end-goals independently arrived at, oftentimes through the use of economic analysis.[56] Of course, that does not really tell us much more than “sometimes history, yes”, and “sometimes history, no.”

Part three finds Posner turning his mind to Psychology. He begins, in a very good chapter, with an examination of the role that human emotion plays, and ought to play, in the law. The interplay between “reason” (or “rationality”) and the emotions is dealt with well. Following Hume, Posner accepts that the normative role played by the law has an irreducibly subjective and emotional aspect. Many of the moral judgments implicit in legal regulation cannot be rationally deduced, rather they are emblematic of the antipathy shown towards particular forms of conduct by members of the society.[57] It therefore follows that a judges’ role is not to stand as an independent tribunal of reason over these subjective emotions, but rather to give force to them as they are incorporated into the law. In so doing, a judge should display empathy in the practice of judging: empathy not for those appearing before a particular judge, but for “the consequences of the litigation for absent ... others who will be affected by your decision.”[58] It is hard to think of a better description of the judicial role than this.

The interplay between the “rational” and those features of human life usually labelled “irrational” continues in the next chapter. Posner here considers the development of what has been called “behavioural economics”,[59] which seeks to apply the insights of cognitive psychology to the kind of rational choice theory I have described above. Behavioural economics builds these cognitive insights into a general claim that the human decision-making process suffers from inherent quirks such that individuals will often fail to select, in a coherent fashion, the best available means to the chooser’s end.[60] Posner, however, tries in two ways to make these apparently irrational behavioural anomalies disappear. Take, for instance, the “problem” of altruism – where an individual forgoes some benefit, or incurs some cost, so as to benefit another person. On the one hand, Posner claims, this form of irrational behaviour can be converted into rational activity by the application of “game theory” modelling.[61] Sharing a windfall benefit in a relatively equal manner, for instance, is described as a signal to others that you are interested in engaging in a long term, cooperative, mutually beneficial series of interactions with them. The other route travelled by Posner is even more tendentious. Certain behavioural patterns which appear to have no possible beneficial outcomes for the particular individual– such as putting one’s life at risk in order to save a complete stranger – are explained through reference to evolutionary biology.[62] Human beings have developed socially in ways that have outstripped our genetic “hard-wiring”, hence we find ourselves “fooled” into continuing to carry out actions that “made sense” in smaller, more intimate social groups (such as protecting our genetic inheritance by risking our lives for family members).

Here Posner has clearly gone a bridge too far. For it now appears that the claims of rational choice theory are unfalsifiable: “rationality” has so broad a content that no conceivable human action could possibly be deemed irrational. This saps the model of any predictive power. Individuals will sometimes act “rationally” by risking their lives for strangers (“fooled” into believing them to be “kin” whose genes should be preserved), and individuals will sometimes act “rationally” by not risking their lives for strangers (having understood that there is no individual benefit to them dying for someone they do not know). At least classic rational choice theory gave rise to some positive claims about how individuals would behave in particular circumstances. Those predictions may have sometimes (often?) been wrong, but they still seem to be more useful (in the Posnerian sense) than his new claim that “humans act as humans will act”.[63]

In the final chapter in this part, Posner trains this reground lens of rational choice on the question of why people feel compelled to obey social rules (“norms”) that are not enforceable through coercion by the state.[64] The problem this poses for Posner is, why should anyone act in a way that they do not want to if they do not have to do so? His answer is that people do “have to” follow social norms because of the internalised feelings of shame and guilt, as well as the external reactions of others, caused by breaching the norm. Why an individual has these feelings, or why others react against a person who break a norm, is simply a question of education and socialisation – the human equivalent of Pavlov’s salivating dogs.[65] Norms can therefore be “useful”, in that they provide a very low-cost method of coordinating social behaviour. But they may also be “bad” in that they may continue to inculcate forms of behaviour which have become inefficient or socially harmful. Individuals, however, will have been socialised into obeying the norm irrespective of its “usefulness” or “badness”, and changing individual attitudes towards a given norm is a tricky and unpredictable business.[66] Therefore, Posner concludes, the gradual replacement of messy social norms as a means of social coordination by cleaner, positive legal rules – the effect of which can be analysed and altered much more easily – is a fact that is to be welcomed.[67]

I shall not long tarry over the last two parts of Posner’s book. In part four he considers the lessons that epistemology can provide for trial practice and procedure. The first chapter claims to discuss the implications of various theories of truth for the issue of witness testimony, but it is nothing more than an extended and critical review of an account of a rather obscure 1990 trial of a defence lawyer in Alexandria, Virginia.[68] Its purpose was completely lost on me. The next chapter is more substantial, providing Posner’s application of economic analysis to the entire process of civil procedure and rules of evidence. This turns the search for “justice” into a weighing up of various trade-offs between the accuracy and the costs of trials.[69] Fortunately for those of us indoctrinated into the status quo, the common-law system of adjudication emerges victorious from this scrutiny: “the adversarial system relies on the market to a much greater extent than the inquisitorial system does, and the market is a much more efficient producer of most goods than the government is.”[70] The final chapter goes through the U.S.’s Federal Rules of Evidence, in essence providing a refinement of and expansion upon the arguments provided in the previous chapter.

The final part of the book comprises a single chapter dealing with the value of empiricism (or “statisitical inference”), with particular reference to the counting of citations. It basically reiterates Posner’s overall point that lawyering ought to take place against a backdrop of solid, quantitative evidence, a message which he illustrates through considering the question of whether the Ninth Circuit Court of Appeal in America should be reduced in size. However, he rather undercuts his own message when he “tentatively” concludes that a statistical analysis of the circuit’s decisions shows us:

that (1) adding judges tends to reduce the quality of a court’s output; and (2) the Ninth Circuit’s uniquely high rate of being summarily reversed by the Supreme Court (a) is probably not a statistical fluke and (b) may not be a product simply of that circuit’s large number of judges.[71]

Exactly how this apparently contradictory empirical finding as to points (1) and (2b) helps resolve the debate on whether the Ninth Circuit is too large (as opposed to just being “too liberal” for the Supreme Court’s taste)[72] is not clear. Of more interest – especially to an academic reader – are Posner’s thoughts on the value of citation counting as a tool. Such activity is, he notes, subject to severe limitations even if all citers are scrupulous and accurate.[73] But it can be useful as a management tool (to grade the impact that an individual’s output has by reference to how often other people advert to it), or as a means of hypothesis testing. Even so, the amount of qualifications he builds into his account leaves open the question as to whether any firm, agreed upon method of counting citations could ever be established.

4: Conclusion

This book is as challenging, confusing, and thought-provoking a work as we have come to expect from Posner’s pen. When he sticks closely to what he is good at, then he is very good indeed. The chapters on “The Speech Market”, “Emotion in Law”, and “The Principles of Evidence and the Critique of Adversarial Procedure” are unreservedly recommended. Unfortunately, Posner also strays so far afield in this book that he sometimes loses his way. The section on History seems to me to be the clearest example of this. Overall, however, it is a bold attempt to assert the primacy of economic decision making – cost-benefit analysis combined with rational choice theory – over a wide range of disciplines that shed light on the practice and processes of the law.

But is the attempt successful? I have already had cause to refer to what I see as being the central problem with Posner’s work – a flaw, I may add, that I am not alone in pointing out.[74] When advocating a particular policy or line of thought, Posner constantly returns to “pragmatic” assertions about what “works”, and what is “useful”, without ever clearly specifying what these terms mean. It is true that Posner’s position as a moral relativist – he claims that “[m]any of our ... moral convictions ... resist reflection or reexamination because they are embodied in tenacious, inarticulable emotion”[75] – along with his belief that rhetoric rather than reason per se is the most effective form of advocating social change, means that he is resistant to claims that any substantive moral theory can ever provide us access to any universally “right” outcomes. But he is no Stanley Fish: he does not believe that legal decision making simply expresses the individual, ad hoc preferences of the decision maker.[76] Posner’s day job, after all, is to sit on a bench and “apply the law”. In Frontiers of Legal Theory he provides us with yet another insight into how he himself approaches a multitude of social issues in his own iconoclastic, “pragmatic” fashion. What is missing from this account, however, is some overall description of how his “pragmatic” approach can be used to generate coherent outcomes by those of us who do not have the good fortune to be Richard A. Posner. Rumour has it that he attempts to do so in his latest (!) book, Law, Pragmatism, and Democracy. If so, it is a development to be welcomed.

Andrew Geddis,
Faculty of Law,
University of Otago.

[1] Richard Posner, Frontiers of Legal Theory, (Harvard University Press, 2001) (hereinafter Frontiers).

[2] Such as: “The aim [of cost-benefit analysis] is to identify and measure the losses and gains in economic welfare which are incurred ... if the particular project is undertaken”, Graham Bannock et al, The Penguin Dictionary of Economics, (2^[nd] ed., Penguin Books, Harmondsworth, 1977), 101-102; or “[rational choice theory asserts that] actors choose the actions with the best outcomes according to their own preferences”, Nicholas Abercrombie et al, The Penguin Dictionary of Sociology (3^[rd] ed., Penguin Books, Harmondsworth, 1994) 343.

[3] Actually, this is by no means an easy task. Richard Posner does not give a precise description of what he understands “cost-benefit analysis” to mean, preferring instead to discuss and critique the various interpretations of the term given by others and gathered together in 29 Journal of Legal Studies (2000); see Frontiers, n. 1 above, at 121-141. He is more concise with relation to “rational choice”, defining it as “choosing the best available means to the chooser’s end.” Ibid., at 252.

[4] I acknowledge a debt to Jean-Jacques Rousseau, The Confessions (Penguin Books, 1984 (1782)) while humbly noting that I have proved the great man wrong; see ibid., at 1 (“I have begun on a work which is without precedent, whose accomplishment will have no imitator.”)

[5] Here I had intended to cite the authority of a number of my fellow faculty members, but several threats of legal action, as well as a couple of displays of outright physical violence, convinced me that I rationally should choose to do otherwise.

[6] The fact that students are prepared to come to some classes colours my colleagues’ blanket description of the students as being “lazy”. My colleagues’ objection cannot be that the students refuse ever to incur the cost of lecture going. They are prepared to do so in some cases – especially when the exam is going to be discussed. So my colleagues’ real objection must be that students (as we shall see) only attend when the expected benefits to be gained from the lecture outweigh the cost of attendance. Thus the use of the term “lazy” really means “inappropriately devaluing the benefits to be gained from the learning of material on which they will not then be examined.”

[7] Ibid.

[8] Aside from my own particular pedagogical failings, other factors relevant to a student’s analysis of the issue are that the Contract Law lectures are held at 9 AM, mornings in Dunedin can be very cold, and hangovers invariably follow late nights spent out drinking.

[9] A question that shall reappear again when I come to look at Posner’s book; see below at nn. 49-52 and accompanying text.

[10] Apart, of course, from those slackers who missed the announcement because they were not at the earlier class! It seems that Otago University’s administrators are wise to this trick. When submitting a teaching evaluation for the purposes of promotion, a staff member is required to explain any case where student participation in the survey falls below 70 percent. It is strange, however, how often illness decimates a class on the day that a teaching evaluation is distributed!

[11] See, eg, The Bible, Mark, ch. 8, verse 36 (“What shall it profit a man if he shall gain the whole world and lose his own soul?”)

[12] After all, what else is the following insight of Macbeth, if not an example of the use of a cost-benefit analysis to clarify a rational choice? “For mine own good, All causes shall give way: I am in blood Stepp’d in so far, that, should I wade no more, Returning were as tedious as go o’er.” William Shakespeare, Macbeth, Act III, Scene iv.

[13] The first edition of Richard Posner’s An Economic Analysis of Law appeared in 1973. Its 5^[th] edition was published in 1998.

[14] For an excellent and very readable introduction see David D. Friedman, Law’s Order: What Economics Has To Do With Law And Why It Matters (Princeton University Press, 2000).

[15] R.H. Coase, “The Problem of Social Cost”, (1961) 3 Journal of Law and Economics 1. This article, which unleashed the famous “Coase Theorem” upon the unsuspecting groves of Academe, is claimed to be “the most-cited article both in law and in economics.” See Fred R. Shapiro, “The Most-Cited Law Review Articles Revisited”, (1996) 71 Chicago-Kent Law Review 751, 759.

[16] Guido Calabresi, “Some Thoughts on Risk Distribution and the Law of Torts”, (1961) 70 Yale Law Journal 499.

[17] See, eg, Eric Posner, Law and Social Norms (Harvard University Press, 2000) at ch. 5.

[18] F. Easterbrook and D. Fisher, The Economic Structure of Corporate Law (Harvard University Press, Cambridge, MA, 1991).

[19] Gary S. Becker, “Crime and Punishment: An Economic Approach”, (1968) 76 Journal of Political Economy 169.

[20] See generally Stewart J. Schwab, “The Law and Economics Approach to Workplace Regulation”, in Bruce E. Kaufman ed., Government Regulation of the Employment Relationship (Basil Blackwell, 1997) 91-123.

[21] Garrett Hardin, “The Tragedy of the Commons”, (1968) 162 Science 1243

[22] For an account of the development and spread of the Law and Economics movement see Neil Duxbury, Patterns of American Jurisprudence (1995) 301-420.

[23] See Robert C. Ellickson, “Trends in Legal Scholarship: A Statistical Study”, (2000) 29 Journal of Legal Studies 517.

[24] The Rt Hon Sir Ivor Richardson, “Law and Economics – and why New Zealand needs it”, (2002) 8 NZBLQ 151; DHL International (NZ) Ltd v Richmond Ltd [1993] 3 NZLR 10.

[25] Although one of the earliest critiques still remains the best. See Johnathan Swift, A modest proposal for preventing the children of poor people from being a burthen to their parents, or the country, and for making them beneficial to the publick (Houghton Library, 1979) (satirically purporting to show how “efficient” it would be to allow the Irish poor to sell their children to be eaten by the English gentry).

[26] Elisabeth M. Landes & Richard A. Posner, “The Economics of the Baby Shortage”, (1978) 7 Journal of Legal Studies 323.

[27] See the collected contributions in “Forum: Adoption and Market Theory: The Regulation of the Market in Adoptions” (1987) 67 Boston University Law Review.

[28] The list is too long even to think about setting out in full, but for a cross-section see Arthur A. Leff, “Economic Analysis of Law: Some Realism About Nominalism” (1974) 60 Vanderbilt Law Review 451; Mark Kelman, “A Critique of Conservative Legal Thought”, in David Kairys (ed), The Politics of Law, (rev. ed., Pantheon Books, 1990) 436, 441-451; Donald P. Green & Ian Shapiro, Pathologies of Rational Choice Theory, (Yale University Press, 1994); Lawrence E. Mitchell, “Understanding Norms”, (1999) 49 University of Toronto Law Journal 177.

[29] See Joseph William Singer, “Something Important in Humanity”, (2002) Harvard Civil Rights-Civil Liberties Law Review 103.

[30] Elizabeth Anderson, Value in Ethics and Economics (Harvard University Press, 1993)

[31] Classic examples are voting, charity giving, and volunteering for military service.

[32] Robert Ellickson, “Bringing Culture and Human Frailty to Rational Actors: A Critique of Classical Law and Economics” (1989) 65 Chicago Kent Law Review 23.

[33] Ernest Weinreb, The Idea of Private Law (Harvard University Press, 1995); Ernest Weinreb, “Legal Formalism: On the Immanent Rationality of Law” (1988) 97 Yale Law Journal 949, at 1015 (“Accordingly, in contrast to the notion of juridical form, the goal of efficiency stands to law as something that is neither moral, nor immanent, nor coherent.”)

[34] See, eg, Jon D. Hanson and Melissa R. Hart, “Law and Economics”, in Dennis Paterson (ed) A Companion to Philosophy of Law and Legal Theory (Blackwell Publishers, 1996) 311, at 330.

[35] Most notably, the recent magnum opus by Louis Kaplow and Steven Shavell, “Fairness Versus Welfare” (2001) 114 Harvard Law Review 961, especially at 985-88 (republished in book form as Fairness Versus Welfare (Harvard University Press, 2002).

[36] Frontiers, n. 1 above, at 1-2.

[37] Ibid, at 15.

[38] Ibid, at 1. See also Richard A. Posner, The Problematics of Moral and Legal Theory (Harvard University Press, 1999).

[39] Frontiers, n. 1 above, at 6.

[40] Eg, ibid., at 189 (“[Paul Kahn] could use a dose of forgetting; he has the American Revolution, and revolution in general, too much on the brain.”)

[41] Ibid., at 51-52.

[42] [1919] USSC 64; 249 U.S. 47 (1919)

[43] For a further elaboration of these views, see Richard A. Posner, “Pragmatism Versus Purposivism in First Amendment Analysis”, (2002) 54 Stanford Law Review 737.

[44] Although he would deny that he is doing so simply to match his own personal preferences, see his discussion of Stanley Fish at Frontiers, n. 1 above, at 83-84.

[45] See Posner’s own judgment in Miller v. Civil City of South Bend[1990] USCA7 422; , (1990) 904 F.2d 1081, 1089 (striking down Illinios’ state-wide ban on nude dancing in bars).

[46] See, eg, Richard A. Epstein, “The Remote Causes of Affirmative Action, or School Desegregation in Kansas City, Missouri”, (1996) 84 California Law Review 1101, 1119-20

[47] Posner admits this, but his answer is that if a society finds this to be a problem, then it should simply use the tax system to redistribute wealth; see Frontiers, n.1 above, at 107. He is, however, personally sceptical that this solution represents a good policy choice.

[48] Ursula Le Guin, The Ones Who Walk Away From Omelas (1993)

[49] Part of a broader turn in Posner’s thought, see Peter F. Lake, “Posner’s Pragmatist Jurisprudence” (1994) 73 Nebraska Law Review 545.

[50] Frontiers, n.1 above, at 102.

[51] Supported by a statistical regression which, I am forced to admit, I do not have the mathematical knowledge to comment on. Those who do feel more equipped to judge Posner’s claims on this point may care to examine the full argument at Richard A. Posner, “Equality, Wealth, and Political Stability” (1997) Journal of Law, Economics, and Organization 344.

[52] Albeit a rather controversial one. Posner is fond of reverting to this broad and amorphous term without really ever specifying what it means, a habit Dworkin describes as “encourag[ing] forward-looking efforts in search of a future it declines to describe.” Ronald Dworkin, “Darwin’s New Bulldog”, (1998) 111 Harvard Law Review, 1718, 1735. See also nn. 73-75 below and accompanying text.

[53] Holmes, “The Path of the Law”, (1897) 10 Harvard Law Review 457, 467; quoted in Frontiers, n.1 above, at 165.

[54] Frontiers, n.1 above, at 176.

[55] Ibid., at 156-159.

[56] Ibid, at 221.

[57] Ibid, at 242-43.

[58] Ibid., at 244. More controversially, Posner then goes on to claim that “The economic approach to law is empathetic because ... it brings into the decisional (sic) process the remote but cumulatively substantial interests of people not before the court ....” Ibid.

[59] The text he treats as the locus classici is Christine Jolls, Cass R. Sunstein, and Richard Thaler, “A Behavioural Approach to Law and Economics”, (1998) 50 Stanford Law Review 1471.

[60] Posner summarises these claims at Frontiers, n.1 above, at 257-63.

[61] Ibid., at 264.

[62] Ibid., at 266.

[63] Posner is reduced to arguing for a “dispelling” of our “irrational” behavioural tendencies (ie “the cognitive quirks and weaknesses of will that prevent people from acting rationally with no offsetting gains”) through the use of education and psychology. Ibid., at 287.

[64] Here the achievements of the son have surpassed those of the father; see Eric A. Posner, Law and Social Norms (Harvard University Press, 2001).

[65] For a (surely unintentionally?) comic description of parents carrying out a cost-benefit analysis of how much of a social norm against theft to instill in their daughter see ibid., at 292.

[66] Ibid., at 299-306

[67] Ibid., at 294, 305

[68] Janet Malcom, The Crime of Shelia McGough (Harvester-Wheatsheaf, 1999)

[69] Frontiers, n.1 above, at 343.

[70] Ibid., at 351. Posner does have some suggested improvements to the system, however; see ibid., at 358-59.

[71] Ibid., at 420.

[72] See generally Adam Liptak, “Court That Ruled on Pledge Often Runs Afoul of Justices”, New York Times, June 30, 2002, A6.

[73] A possibility he heavily discounts, see ibid., at 425.

[74] Dworkin, n.52 above; Eric Rakowski, “Posner’s Pragmatism”, (1991) 104 Harvard Law Review 1681; Lake, n.49 above, at 644 (“Posner calls in the pragmatic airstrikes on his own position not only with the use of the term pragmatism to describe his theory but also with his insistence on instrumentalism, his jurisprudential methodology, and at least a significant part of his account of intuitionism (notably tacit understanding).”).

[75] Frontiers, n.1 above, at 242. See also Richard A. Posner, “The Problematics of Moral and Legal Theory”, (1998) 111 Harvard Law Review 1637, 1640-41.

[76] Frontiers, n.1 above, at 83-84.