ABSTRACT
This chapter argues that the commonplace assumption of an "elective affinity" between economic globalization and the rule of law is misleading. It suggests that the experience of contemporary economic globalization raises fundamental questions for both traditional and contemporary legal theory. The legal status of international business arbitration remains controversial within the burgeoning scholarly literature on the topic. The main legal basis for international business arbitration is the Lex Mercatoria, the customary law of merchants and traders operating abroad. Intellectual convention by defining the rule of law as requiring that state action rests on legal norms general in character, relatively clear, public, prospective, and stable. Finance and banking not only constitute the globalized sector of the world economy, but their legal infrastructure is informal, ad hoc, and relatively private as well. The legal weaknesses of general agreement on tariffs and trade (GATT) derive from an economically irrational hostility to market competition, and a concomitant paternalistic interest in defending economic "losers".
