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Autopoetic Social Systems Theory: The Co-evolution of Law and the Economy

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  • Lourenço, A.

Abstract

This paper explores the relationship between regulation and contracts from the point of view of autopoietic social systems theory. Building on the notions of contract as a structure of governance, and of regulation as a system of rules intended to govern the behaviour of its subjects that involves standard setting, monitoring and enforcement, the paper discusses the contributions of Teubner (1993), Collins (1999) and Deakin (2002) for understanding the relationship between the legal and the economic subsystems in society. The paper argues that regulation and contracts co-evolve: the influence of regulation upon contracts is mediated by the system of shared meanings that the contract develops and, reciprocally, the influence of contracts on regulation depends on each regulatory element's own network of communications. The paper concludes that reflexive regulatory strategies, by facilitating the emergence of shared meanings, may be more successful in governing the behaviour of economic actors. However, given the disturbances involved in the process of co-evolution, this is not straightforward.

Suggested Citation

  • Lourenço, A., 2010. "Autopoetic Social Systems Theory: The Co-evolution of Law and the Economy," Working Papers wp409, Centre for Business Research, University of Cambridge.
    • Handle: RePEc:cbr:cbrwps:wp409
    Note: PRO-2
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    File URL: https://www.jbs.cam.ac.uk/cbrwp409/
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    References listed on IDEAS

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    1. Simeon Djankov & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2002. "The Regulation of Entry," The Quarterly Journal of Economics, Oxford University Press, vol. 117(1), pages 1-37.
    2. Simon Deakin, 2002. "Evolution for our time: a theory of legal memetics," Working Papers wp242, Centre for Business Research, University of Cambridge.
    3. Simon Deakin & Fabio Carvalho, 2009. "System and Evolution in Corporate Governance," Working Papers wp391, Centre for Business Research, University of Cambridge.
    4. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    5. Oliver E. Williamson, 2000. "The New Institutional Economics: Taking Stock, Looking Ahead," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 595-613, September.
    6. Simon Deakin & Alan Hughes, 1999. "Economic Efficiency and the Proceduralisation of Company Law," Working Papers wp133, Centre for Business Research, University of Cambridge.
    7. Bernstein, Lisa, 1992. "Opting Out of the Legal System: Extralegal Contractual Relations in the Diamond Industry," The Journal of Legal Studies, University of Chicago Press, vol. 21(1), pages 115-157, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Autopoiesis; Reflexive law; Decentred regulation.;
    All these keywords.

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General

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