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Models of Morality in Law and Economics: Self-Control and Self-Improvement for the "Bad Man" of Holmes

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  • Cooter, Robert D.

Abstract

Holmes commended scholars to analyze law from the viewpoint of a "bad man." If Holmes had in mind everyday wrongdoing, and not a lofty evil, then he prescribed the research strategy of law and economics. The virtuous prefer good, villains prefer bad, and rational actors in economics prefer themselves. Instead of obeying or disobeying the law for its own sake, the rational actor in economics treats law as an obstacle or an instrument, not a value. The success of the economic analysis of law proves the fruitfulness of this research strategy. Instead of praise, however, this paper offers critique and extension. As the social complexity that law regulates increases, economists typically prescribe decentralization. Decentralized law works best when spontaneous obedience and private enforcement supplement state coercion. Internalized morality prompts spontaneous obedience and perfects private enforcement. Thus minimizing state coercion maximizes reliance upon internalized morality. Developing a theory of morality to anchor decentralized law requires extending models beyond the bad man. This paper develops two fundamental ideas of morality: self-control and self-improvement. I will explain how law harnesses and strengthens self-control, and also how the law changes people by creating opportunities for self-improvement.

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  • Cooter, Robert D., 1998. "Models of Morality in Law and Economics: Self-Control and Self-Improvement for the "Bad Man" of Holmes," Berkeley Olin Program in Law & Economics, Working Paper Series qt5dj8m2kf, Berkeley Olin Program in Law & Economics.
  • Handle: RePEc:cdl:oplwec:qt5dj8m2kf
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    Cited by:

    1. Mark White, 2010. "Adam Smith and Immanuel Kant: On Markets, Duties, and Moral Sentiments," Forum for Social Economics, Taylor & Francis Journals, vol. 39(1), pages 53-60, January.
    2. Sue H. Mialon, 2014. "Declining Moral Standards and the Role of Law," Emory Economics 1410, Department of Economics, Emory University (Atlanta).
    3. Bruno Deffains & Claude Fluet, 2015. "Social Norms and Legal Design," CIRANO Working Papers 2015s-44, CIRANO.
    4. Stringham, Edward Peter, 2011. "Embracing morals in economics: The role of internal moral constraints in a market economy," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1-2), pages 98-109, April.
    5. Brennan, Geoffrey & Brooks, Michael, 2011. "On the ‘cashing out’ hypothesis and ‘soft’ and ‘hard’ policies," European Journal of Political Economy, Elsevier, vol. 27(4), pages 601-610.

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