Introduction to law and economics
The economic analysis of law, or the law and economics movement, will soon celebrate its fi rst half century. In recent decades it is emerging as the dominant theoretical paradigm and scientifi c methodology for legal scholarship, and it is gradually capturing various segments of policy-making and legal discourse of legislatures, courts and legal practitioners. 3 Although initially law and economics prospered mainly in North America, in the last decades it is rapidly increasing also in Europe and elsewhere. Yale Law Professor, Bruce Ackerman (1984), referred to it as ‘the most important development in legal scholarship in the Twentieth century’. Law and economics is an offspring of American legal realism, which fl ourished in the mid 20th century. Legal realism emerged as a response to the positivist-formalist paradigm to law that replaced the natural law paradigm.