Upload
franklinbarrientosramirez
View
222
Download
0
Embed Size (px)
Citation preview
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 1/16
BENTHAM S
INFLUENCE
ON THE
L W AND
ECONOMICS
MOVEMENT
Richard A. Posner*
I have been asked to discuss Bentham s influence on the important
modern movement in legal scholarship known as law and
economics , or, more descriptively, as the economic analysis
of
law. The topic is both narrow and difficult.
It
is narrow because it
concerns only a tiny slice
of
Bentham s vast influence on legal
thinking and practice.
1
It is difficult because the determination of
influence is difficult, especially when the span of time that must be
considered
is
great. The law and economics movement began
sometime between 1958 and 1973. The first date is the first year
that the
Journal
of
aw and Economics
was published, and the
second date is the date of publication of the first edition of my
book Economic Analysis of Law. Before the launching of the
Journal
of
Law and Economics,
the law and economics movement
could not have been said to exist; after my book was published, its
existence could not be denied, though it could be deplored. f one
This is the slightly revised text of my Presidential Address to the Bentham
Club of University College London, on 2 Mar. 1998. I thank Gary Becker and Eric
Posner for helpful discussions of
the topic, and Ronald Coase, Neil Duxbury, and
Peter Newman for helpful comments on a previous draft.
1
n
which see, e.g., George W. Keeton and Georg Schwarzenberger (eds.),
Jeremy Bentham
and
the Law: A Symposium (London, 1948); Gray
L.
Dorsey,
The Influence of Benthamism on Law Reform in England (1968) 13
St
Louis
University aw Journal
11; Peter J King,
Utilitarian Jurisprudence in America:
The Influence of Bentham
and
Austin on American Legal Thought in the
Nineteenth Century (New York, 1986) chs. 2-5. I have found only one previous
work on Bentham s relation to the law and economics movement: Alan Strowel,
Utilitarisme et approche economique dans la theorie du droit: autour de Bentham
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 2/16
426 Richard A Posner
year must be picked for the beginning of the movement, it would
be 1968,
and
for a reason that turns
out to
be connected, though
only loosely, with Bentham. And in 1968 Bentham
had
been dead
for 136 years.
I must distinguish between two meanings of influence . One,
which I will call inspiration , refers to the situation in which (if
we are speaking, as I shall be, of the influence of a person s ideas)
an idea held by one person, call him A , is picked up from A by B
and used by B. The important thing is that B in fact got the idea
from A rather
than
discovering it independently or borrowing it
from someone whose chain of title does not go back to A. The
second sense
of
influence , which I will call cause (though neces-
sary condition would be more precise), refers
to
the situation in
which B would not have used the idea if A had never held it. To
determine influence in this sense a counterfactual inquiry is neces-
sary; one must ask how would the world, and specifically how
would Bentham, have been different had A never existed or been
in a different line of work? B might have been inspired by A in the
sense of having got an idea from him, and yet it might be that if A
had
never lived B would have got the same idea from someone
else, who would have discovered or invented it had A never
existed discovered it later, but before B s time. The longer the
interval between A and B the likelier it is that someone else would
have thought of the same idea, in which event A could not be said
to have caused B to hold the idea B would have held it even if A
had never lived.
Inspiration is much more easily determined than causation.
t
does not involve speculation about counterfactuals, and can
usually be determined from records or statements by B or his
acquaintances or by the sort of internal evidence (striking similar-
ity inexplicable except on the hypothesis of copying) used in many
copyright cases to determine copying. Notice
that
causation
entails
influence if
the later
work
did
not
derive directly or indi-
rectly from the earlier, the earlier could not have caused the
later although influence does not entail causation, because I am
treating inspiration as a mode
of
influence, though often it will
have no causal efficacy.
In the case of Bentham, it would be extremely difficult
to
estab-
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 3/16
Bentham and aw and Economics
427
death. But I think he can be shown
to
be one of the inspirers. That
any rate
is
the dual thesis that I shall try
to
defend in this paper.
I may
not
assume, however,
that
all readers are familiar with
the law
and
economics movement. And so before turning directly
to the issue of Bentham s influence, let me describe it briefly.2
That
there is a relation between economics
and
law was, of
course, known (quite apart from Bentham) long before the 1960s.
But the relation was thought limited to the handful of legal fields,
mainly antitrust
and
public utility (or common carrier) regulation,
that dealt explicitly with competition
and
monopoly, which as
early as the 1930s were receiving the sustained
and
sophisticated
attention
of
leading English
and
American economists.
3
In retro
spect, an economic literature dealing with other fields of law,
notably Robert Hale s work on contract law, which also dates
from the 1930s, can be discerned. But even after the
Journal of
Law and Economics commenced publication, the law and
economics movement, if discernible
at
all, would have been asso
ciated primarily with problems of competition
and
monopoly,
with occasional forays into taxation (Henry Simons) and corpora
tions (Henry Manne), even patents (Arnold Plant).
t
was
not
until
1960, when Ronald Coase s article The Problem of Social Cost
was published,4 and
at
about the same time Guido Calabresi s
first article on torts, that an economic theory of the common law
could be glimpsed. When several years later Gary Becker
published his article Crime and Punishment: An Economic
Approach ,5 it began
to
seem that perhaps
no
field
of
law could
not be placed under the lens of economics with illuminating
results. And within a few more years papers on the economics
of
contract law, civil
and
criminal procedure, property, consumer
protection, and other areas new
to
economists
had
appeared
and
the rough shape
of
the mature field could be glimpsed. Later,
books
and
articles would extend the economic analysis of law into
such fields as employment, admiralty, intellectual property, family
2
See
also The Future of Law and Economics: Looking Forward (1997) 64
University
of
Chicago aw Review
1129 (round-table discussion);
and
my text
book-treatise,
Economic Analysis
of
Law
(5th edn., Cambridge, Mass., 1998).
3 Competition
and
monopoly had received the attention
of
economists since
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 4/16
4 8
Richard A Posner
law, legislation, environmental law, administrative law, conflict of
laws,
and
judicial
behaviour and
this
is
only a partial list. The
field has developed
to
the point where the dean of the Yale Law
School, a critic
of
the field, said recently: [t]he law and economics
movement was and continues to be
an
enormous enlivening force
in American legal thought and, I would say, today continues and
remains the single most influential jurisprudential school in this
country,.6
Economic analysis of law as it
now
exists, not only in the
United States
but
also in Europe, which has a flourishing law
and
economics association, has both positive (that is, descriptive) and
normative aspects.
t
tries to explain and predict the behaviour
of
participants in and persons regulated by the law.
t
also tries
to
improve law by pointing
out
respects in which existing or
proposed laws have unintended or undesirable consequences,
whether on economic efficiency, or
on
the distribution of income
and wealth, or
on
other values.
t
is
not merely an ivory-towered enterprise, at least in the
United States. There the law
and
economics movement is under
stood
to
have influenced legal reform in a number
of
important
areas, including antitrust, the regulation of public utilities and
common carriers, environmental regulation, the calculation of
damages in personal injury suits, the regulation of the securities
markets, the federal sentencing guidelines, the law governing
investment by pension funds and other trustees,
and
even the divi
sion of property
and
calculation of alimony in divorce cases. And
it has also been a significant factor in the deregulation movement
and in free-market ideology generally. Most major and many
minor law schools in the United States have one or two full-time
economists
on
their faculty; a number of law professors have
Ph.Ds in economics; there are six scholarly journals devoted
to
economic analysis of law, with a seventh on the way; the use of
economists as expert witnesses has become conventional in a
range of important fields; judicial opinions refer to economic
concepts
and
cite economic books and articles; and a number
of
federal judges, including a Justice of the Supreme
Court
(Stephen
Breyer), are alumni
of
the law
and
economics movement.
As
my
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 5/16
entham and
aw
and Economics
429
quotation from Dean Kronman suggests, economic analysis of law
is
generally considered the most significant development in legal
thought in the United States since legal realism petered
out
a half
century ago.
Most economic analysis consists of tracing
out
the conse-
quences of assuming
that
people are more or less rational in their
social activities. In the case
of
the activities
that
interest the law,
these people may be criminals or prosecutors or parties to acci-
dents
or
taxpayers
or
tax collectors
or
striking
workers-or
law
students. Students treat grades as prices, so
that
unless the univer-
sity administration intervenes, unpopular professors, in order to
keep up their enrolments, will sometimes compensate students for
the low perceived value
of
the course by giving them higher
grades, that is, by raising the price
that
the professor pays for the
student.
I said that the tracing
out
of consequences
is
subtle as well as
simple, and here is an example. A spendthrift clause is a very
common, indeed standard (in the United States
at
any rate), provi-
sion in a trust whereby the trustee is forbidden to
payout
any of
the money
or
other property in the trust to the creditors
of
the
trust s beneficiaries. The law will enforce such a restriction, yet it
has seemed to many students of the law a fraud
on
creditors; for
the trust beneficiary, assuming
that
his whole wealth
is
in the
spendthrift trust, can borrow all he wants, spend what he
borrows, and not be forced to repay the lenders. But if one thinks
about this for a moment, one will be driven to the opposite
conclusion-that
provided the provision preventing creditors
from reaching into the trust is
not
concealed, a spendthrift trust
limits borrowing by the trust beneficiary, because he cannot offer
security to the lender. And the next step in the analysis
is
to see
how increasing the rights of debtors in bankruptcy, far from caus-
ing an avalanche of reckless borrowing, could reduce the amount
of
borrowing, and so the incidence
of
bankruptcy, by causing
lenders to make smaller loans to risky borrowers. o lenders may
oppose easy bankruptcy,
not
because they fear there will be more
defaults, but because they fear a reduction in the demand for
loans.
To
see this, imagine
how
many,
or
rather how few, loans
there would
be
i
borrowers had no obligation to repay. Notice
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 6/16
430 Richard A Posner
right, as under ancient
Roman
law,
to
carve up a defaulting
borrower into as many pieces as there were creditors, most people
would be afraid to borrow. This discussion will help you
to
under
stand why in Chicago loan sharks break the legs
of
defaulting
borrowers but do not kill them.
Much economic analysis of law is, despite the reputation
of
economics for being jargonized and mathematized, quite simple,
though the simplicity is deceptive; the simple can be subtle. Most
consists of simply tracing out the consequences of assuming that
people are more
or
less rational in all the decisions they make,
whether as criminals or prosecutors or parties to accidents or
taxpayers
or tax
collectors
or
striking workers.
t
is
true
that
many
of these decisions are made under conditions of uncertainty. But
economists have devoted a good deal of attention
to
decision under
uncertainty. An important example of a law-related decision under
uncertainty is deciding how much care to take
to
avoid an accident.
Assume that the accident will occur with probability P, and that if it
does occur it will impose a cost that I will call L for loss; and
assume further that eliminating the possibility of such an accident
would impose
on
the potential injurer a cost
that
I will call B (for
burden). Then it
is
easily seen that the cost of avoiding the accident
will be less
than
the expected accident cost (or benefit
of
avoiding
the accident) if B is smaller than L discounted (multiplied) by P
or
B<PL and if this condition is satisfied then the potential injurer can
be said to be negligent if he fails
to
take the precaution. This is the
negligence formula of Judge Learned Hand, announced in a judicial
opinion in 1945 but not recognized as an economic formula for
determining negligence until many years later.
t is
a simple formula,
but its elaboration and application to specific doctrines in the law of
torts have generated an immense and illuminating literature.
With this severely truncated sketch
of
the law and economics
movement as background, I complete my preliminaries and move
at once
to
the issue of Bentham s influence
on
the movement,
beginning first with the inspirational aspect
of
influence. Here the
clearest example, it might seem, would be presented by Gary
Becker s 1968 crime paper,? which has turned out to be a fount
of
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 7/16
Bentham and Law and Economics
431
economic writing on crime and its control. Becker s paper
contains several citations to the discussion of the economics of
crime and punishment in Bentham s
Introduction to the Principles
o
Morals and Legislation
8
Bentham had made a number
of
important economic points in the
Introduction:
a person commits
a crime only if the pleasure he anticipates from the crime exceeds
the anticipated pain, or in other words only if the expected benefit
exceeds the expected cost; to deter crime, therefore, the punish
ment must impose sufficient pain that, when added to any other
pain anticipated by the criminal, it will exceed the pleasure
th t he
anticipates from the crime; punishment greater th n this should
not
be imposed, because the result would be to create pain (to the
undeterrable criminal) not offset by pleasure (benefits) to the
potential victims of crime;9 the schedule of punishments must be
calibrated in such a way th t if the criminal has a choice
of
crimes,
he commits the least serious; fines are a better method of punish
ment th n imprisonment, because they confer a benefit as well as
impose a detriment; the less likely the criminal
is
to
e
caught, the
heavier the punishment must be, to maintain n expected cost
great enough to deter.
(If
C
is
the social cost
of
a crime, P the
probability the criminal will
e
caught, and S the sentence if he
is
caught, then, as a first approximation, C should equal P times S
(C=PS). Hence
i
C is unchanged and P falls, S must
e
increased
to maintain the desired equality.)
These points constitute the essential elements
of the economic
theory of crime and punishment as revived by Becker. Becker and
his successors added a great deal, but the core
is
clearly and
comprehensively stated in Bentham s
Introduction
Even though
Bentham was a famous economist and the economic character of
his analysis of crime and punishment
is
unmistakable despite the
slightly archaic vocabulary, and even though Bentham s theory
has influenced the design
of
the criminal justice system in England
8 (1780, expanded edn. 1789). Becker also cites Sutherland s treatise on crim
inology, which contains a few references to Bentham, but credits Beccaria with
having made the principal contribution
of
this doctrine [utilitarianism] to penol
ogy : Edwin H. Sutherland, Principles o Criminology (5th ed., revised by Donald
R. Cressey, Chicago, Ill., 1955), 52.
9 Bentham recognized the vengeful pleasure
th t
punishment can produce,
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 8/16
432 Richard A
osner
and the United States, no economist before Becker, so far as I have
been able to determine,
had
expounded an economic theory of
crime and crime control. But I have it on good
authority namely
from Becker
himself that
when he began thinking
about
the
economics of crime, he was unaware of Bentham s discussion of it.
He became aware of that discussion while he was working on his
article,
but
he no longer remembers whether any of the points in
the article were suggested to him by it, although a few of the cita-
tions to Bentham in it suggest
that
they may have been.
10
o
this
turns out to be an uncertain case of Bentham s having influenced
by inspiration the economic analysis of law.
Consequently
t
is
an
even more doubtful case for arguing
that
Bentham was a cause of that analysis. For even if Becker had been
inspired by Bentham, it is possible that if Bentham
had
written
nothing
about
crime, or, for that matter, if Bentham
had
never
been born, some other economist before Becker would have
invented the economic theory of crime in essentially the same form
as
Bentham.
He
was not, after all, the inventor of utilitarianism;
and in retrospect, at least, crime seems a natural field for the
application of utilitarian
ideas in
fact, Bentham s predecessor,
Beccaria, an earlier utilitarian,
had
discussed crime in utilitarian
terms, although much less systematically than Bentham.
Yet if an economic theory of crime was somehow in the air in
the latter part of the eighteenth century, it
is
remarkable that
almost two centuries passed before another economist picked up
on it.
o
there
is
just a chance that if Bentham had never lived, the
economic theory of crime would have had to wait a few more
years to become a part
of
modern law and economics. But it is a
small chance, since Becker s economic theory of crime appears to
be largely an independent discovery rather
than
a case of copying.
Bentham did not, so far as I
am
able to discover (though I will
not
pretend to be
an
expert on Bentham s voluminous and still
not
easily accessible corpus of writings), write on other areas
of
law
from
an
economic standpoint. The qualification
is
vital, since he
wrote extensively on other areas of law besides crime, notably
evidence, not to mention his unpublished advocacy of the repeal
of the sodomy laws. But it is only with respect
to
the criminal law
that
he formulated an economic theory. I suspect the reason was
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 9/16
Bentham and
aw and
Economics
433
that he was extremely interested in issues of social and political
governance, and the criminal law is an important
part
of
that
governance. I do
not
think he realized
that
tort, contract, and
property law are also important parts
of
the social fabric. He may
have been blinded to this by his antipathy to the common law,
which he seems to have thought served no function other than to
enrich lawyers. Curiously, though, when he wrote, the criminal
law was largely a body of common law as well.
Just because he confined his economic approach (so far as law
was concerned) to criminal law, it does
not
follow
that
his influ
ence on the economic analysis of law is necessarily confined to the
area
of
crime (where
that
influence may, in fact, as I have just
suggested, have been slight). I think, and shall now try to show,
that his utilitarian theory may have had an important influence on
the law and economics movement quite apart from any specific
applications
of
utilitarianism by him to law, and
that
even his
non-economic writing on law may have influenced the movement.
An initial distinction should
be
made between utilitarianism as a
description of human behaviour and utilitarianism as an ethical
theory. Bentham
is
better known for the latter than for the former,
but this may
be
cause for regret. Bentham, as I said earlier, was not
the first utilitarian. Utilitarian ideas go back to Aristotle, and utili
tarianism as a fundamental ethical principle had been clearly enun
ciated in the eighteenth century, before Bentham wrote, by
Hutcheson, Beccaria, Helvetius, Priestley, Godwin, and others-
and, indeed, by Beccaria in virtually the same words as Bentham-
the greatest happiness of the greatest number 11 What sets
Bentham apart, what makes him the real father
of
utilitarianism,
is
the tenacity, even vociferousness, of his insistence on the universal-
ity of utility calculations in human decisions.
As
he
put
it on the
very first page of the Introduction to the Principles of Morals and
Legislation [nlature has placed mankind under the governance of
two sovereign masters, pain and pleasure They govern
us
in all
we do, in all we say, in all we think. Another name for pain, as I
have said, is cost; and for pleasure, benefit; so Bentham is claiming
11 See H. L A
Hart,
Bentham
and
Beccaria , in H. L A Hart, Essays on
Bentham: Studies in Jurisprudence and Political Theory (Oxford, 1982), 40.
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 10/16
434 Richard A Posner
that all people, all the time, in all their activities, base their action
(and words, and thoughts)
on
co.st-benefit analysis. Bentham spent
much of his life reiterating, elaborating, and instantiating this claim.
This claim could be thought the foundation
of
the economics of
non-market behaviour, which is to say the investigation by econo
mists of behaviour that occurs other than in explicit markets. A
good deal of the economic analysis of law
is
an application of those
economics, because law
is
primarily a non-market institution and
one that regulates non-market as well as market
behaviour the
behaviour of criminals, prosecutors, accident victims, divorcing
couples, testators, polluters, religious believers, and so forth, as well
as
businessmen, workers, and consumers engaged in their conven
tional activities (an important qualification, since businessmen, for
example, can be polluters or criminals as well as buyers and sellers).
Without economics of non-market behaviour, the scope of
economic analysis of law would be where it was in the 1950s,
limited to the analysis
of
the legal regulation
of
explicit markets.
Bentham may be taken to have invented non-market economics.
His invention, however, lay fallow for almost as long as his theory
of crime and punishment. The explanation belongs
to
the sociology
of science. That is, it has to do with why scientists are interested in
one set of problems rather than another, and specifically with why
nineteenth-century economists, and economists in the first half of the
twentieth-century as well, took virtually no professional interest in
such social phenomena as crime, litigation, the household, discrimi
nation, accidents, and rules of law. An important exception
is
the
interest taken by A.
C
Pigou and Frank Knight in externalities, of
which accidents to strangers
is
a form and one brushed by Pigou.)
Maybe they felt they had their hands full trying to understand the
market economy, or maybe they felt they lacked good tools, and a
metric comparable to money, for studying non-market phenomena;
there are economists who believe this to this day. At all events, until
Gary Becker s Ph.D dissertation in the 1950s, the subject of which
was the economics of racial discrimination, the promise of
Bentham s claim for the universality of the economic model of
human behaviour had been essentially ignored.
12
12
For a striking example, see T. W. Hutchison, Bentham as an Economist,
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 11/16
Bentham and
Law
and Economics
435
Again I have it from Becker
that
he was not consciously follow
ing in Bentham s footsteps. He identified Bentham with the
normative thesis that there is a moral duty to maximize the great
est happiness
of
the greatest number rather than with the positive
thesis that people act so as to maximize their own utility. Utility
maximization had, however, long been a fundamental principle
of
economics, and though its origins in Bentham had largely been
forgotten (probably because it did not become useful to econo
mists until some fifty years after Bentham s death
13
),
he can claim
credit for having planted the idea.
14
But before Becker, economists generally assumed, though
usually implicitly rather
than
explicitly,
that
people maximized
utility only in economic markets. The handful of economists who
claimed in the spirit of Bentham that utility maximization was a
universal feature
of
human
psychology-of whom
the outstanding
example is Wicksteed-did not cite Bentham for this proposi
tion,15 and, more important, did very little with his insight into
the possibility
of
applying economics to non-market behaviour.
16
Becker s manifesto on behalf of non-market economics does
mention Bentham, along with Adam Smith and Karl
Marx,
as
precursors,17 but criticizes Bentham for having been primarily a
reformer and having failed to develop a theory
of actual human
13 George J. Stigler, The Adoption of the Marginal Utility
Theory ,
in
G. J. Stigler, The Economist
s
Preacher and Other Essays (Oxford, 1982), 72,
76.
14
Ibid., 78.
15 See Philip H. Wicksteed, The Common Sense of Political Economy (Lionel
Robbins (ed.), (first published in 1910), London, 1935), i, ch.
1 As
Robbins points
out in his introduction, Wicksteed insist[edl that there can
be
no logical dividing
line between the operations of the market and other forms or rational action (p.
xxii). Yet Robbins does
not
attribute this idea
of
Wicksteed s
to
Bentham;
nor
does
he cite Bentham in the book in which he expounded his own, equally broad
conception of economics: Lord Robbins, n Essay on the Nature and Significance
of
Economic Science
(3rd edn., London, 1984 . Not much significance can be
assigned
to
Wicksteed s failure
to
cite Bentham, however, as he cited hardly
anyone, except Jevons once.
16 Although ch. 1 of The Common Sense of Political Economy contains a
lengthy discussion of household production.
17
See
Gary
S.
Becker,
The Economic Approach to Human Behavior,
ch. 1
(1976), reprinted in The Essence of Becker, n. 7 above,
at
7-8, 15, n. 13. He also
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 12/16
436
Richard A Posner
behavior with many testable implications J8 And here we can see
another reason why Bentham s contributions
to
economics have
frequently been overlooked. He does not have a clear identity as
an economist.
19
His importance as a philosopher and reformer has
tended
to
overshadow his economic work. Of course, Adam Smith
was also a famous philosopher as well as an economist, but Smith
wrote a treatise
on
economics,
and
Bentham did not.
Still, if the idea of utility maximization as a fundamental
feature (whatever its precise scope) of human psychology can be
traced to Bentham, as I believe it can be, then the economics of
non-market behaviour the branch
of
economics that takes this
idea most
seriously can
be said
to
have been influenced by
Bentham. And, to repeat, without the economics of non-market
behaviour, the scope of the economic analysis of law would be
greatly contracted. But again this is influence in the sense of inspi
ration.
t
is unlikely that if Bentham
had
never lived, utility maxi
mization would never have been discovered
or
applied
to
non-market behaviour, for remember that we are talking
about
a
lag of almost two centuries between the Introduction and Becker,
and
that
the concept of utility and the philosophy
of
utilitarianism
both predate Bentham.
Two more routes of influence between Bentham and the law
and economics movement remain to be traced. The first goes
through welfare economics
and
the second through legal realism.
The idea not that maximizing utility is what people in fact
do
but
that it is what people, and governments, should
do that
utility
somehow aggregated across persons (in some versions, across all
sentient beings) should be the guide to moral
and
legal duty is
the foundation of economics viewed as a normative discipline.
Utilitarianism, although it continues
to
have distinguished defend
ers among economists, such as John Harsanyi, has taken
hard
knocks lately,
and
not only from philosophers. Some economic
analysts of law, myself included, believe that utilitarianism has a
number of serious weaknesses, and that a better goal for law
economically conceived is the maximization of wealth defined as
18
At 8. For a similar criticism
of
Bentham for having over-emphasized reform
at the expense of positive analysis, see Richard A. Posner, The Economics
o
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 13/16
Bentham and aw and Economics
437
the sum of consumer and producer surplus in all market and non
market activities. But these are details. The important point
is
that
Bentham can be considered, along with Smith, who was, however,
more ambivalent about the ethical significance of economics, the
founder of normative economics. This
is
true I think even though
so influential an early welfare economist as Pigou did not cite
Bentham and used the term total welfare rather than utility,20
citing Sidgwick,21 whose utilitarianism can, however,
be
traced to
Bentham. And because the law
is
inveterately normative-because
law professors, judges, and practitioners are all looking for
grounds for evaluating actions and proposing reforms-the fact
that
economics have a normative dimension was of great impor
tance in the reception of economics into legal thinking. But once
again while the inspirational influence of Bentham seems undeni
able, the causal influence
is
altogether less clear. Even if Bentham
had
not lived, there
is
a substantial likelihood that a normative
version of economics oriented toward utility maximization would
have emerged in the almost century and a half between his death
and the birth of the law and economics movement.
Last to
be
considered
is
the influence
of
Bentham on law and
economics via legal realism. Legal realism is an instantiation of
one side of an age-old jurisprudential debate. Bentham is
an influ
ential earlier instantiation; but the debate
is
fully discernible as
early as Plato s dialogue Gorgias, where Socrates equates the
rhetoricians whom today we would call lawyers with the lowest
form of sophist and demagogue. Much later, in the reign of James
I in the seventeenth century, the debate would be carried on
between Chief Justice Coke and James, the former extolling the
artificial reason of the law , or what today would be called legal
reasoning, and James wondering why the law should be the
preserve of a guild of obscuranist quibblers. Toward the end of
the eighteenth century the debate resumed, with Blackstone taking
Coke s place and Bentham James s. Although Blackstone was not
the shameless apologist for the professional status quo that
Bentham depicted him as in A Fragment on Government 1776),
he did praise the common law and emphasize the importance of
legal rights. Bentham, in contrast, thought the common law a
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 14/16
438
Richard A Posner
hopeless muddle, good only for keeping lawyers in fees, and he
thought rights talk nonsensical. But he did not just say these
things; he tried to reconstruct the law, proposing for example
that
the common law be replaced by a simple, readily understandable
code that would largely dispense with the need for lawyers.
He
wanted law to be rebuilt on a scientific basis shaped by the
Greatest Happiness principle, and the traditions and usages of
traditional law discarded.
He
was the great debunker of law, and his numerous followers
in England, and fewer but still influential followers in America,22
including the designer of the first great American law code, David
Dudley Field,
who
drafted a code of procedure for
New
York
State, kept the Benthamite flame of legal reform lit. Without
Benthamite legal scepticism, it
is hard
to imagine Oliver Wendell
Holmes writing what turned
out
to be the manifesto of legal real-
ism his
1897
essay The Path of the Law . And without Holmes s
involuntary sponsorship it is a little
hard
to imagine legal realism
obtaining quite the hold over the legal imagination that it did in
the 1930s complete with a zeal for codification that reached its
zenith in the promulgation
of
the Uniform Commercial Code. And
without legal realism it
is
hard to imagine Guido Calabresi
embarking on his project of rethinking the law of torts in light of
economics. His first article on torts thanks Fleming James and
Fowler Harper, two leading legal realist torts scholars, and though
there is an element of piety toward one s elders in this reference, it
is
also apparent that Calabresi, a product of the Yale Law School,
the bastion of legal realism and still identified with it when
Calabresi started teaching there in the late 1950s, was saturated
with the realist spirit.
The path is indirect, even circuitous, and the issue
of
causal
influence
is
once again indeterminate. And yet it does seem to lead
without breaks from Bentham to Calabresi, who was, of course,
one of the principal founders of the modern law and economics
movement.
To
summarize, I do
not
think it
is
possible to show
that had
Bentham
not
lived the law and economics movement would have
been delayed
or
different. But I think it
is
highly likely
that
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 15/16
entham and aw and Economics
439
Bentham
had
an important though indirect influence on the
movement in two distinct ways. First he pointed the way toward
using economic thinking normatively
and
this was very important
to
the movement. Secondly he is an ancestor
of
legal realism
and
realism particularly through Calabresi was important in the
creation of the movement. n both counts Bentham can rightly
be described as
an important influence on law
and
economics.
8/9/2019 Bentham Influence on the Law Posner
http://slidepdf.com/reader/full/bentham-influence-on-the-law-posner 16/16
Reproduced with permission of the copyright owner. Further reproduction prohibited without
permission.