ABSTRACT
A BASIC QUESTION for law and economics is the efficiency of law. Hayek, although writing before the law and economics movement and writing from another perspective, had argued that common or judge made law was better than statute law; I return to Hayek’s arguments below. 1 Posner has of course argued often and forcefully that the common law is efficient. 2 His arguments are based on examination of particular legal doctrines. I call this the “micro” argument for legal efficiency. The evolutionary models were aimed at explaining this micro efficiency. There is another more recent literature that uses empirical methods to compare various legal systems. This literature generally finds that common law is more efficient than other forms of law. I call this the “macro” argument for efficiency. It is ultimately a Hayekian argument, based on the idea that in common law systems governments have less power than in other systems. I first discuss micro efficiency, and then macro.
