The Efficient Production of Law. The Political Economy of the Sources of Law

Law and economics scholarship has been predominantly concerned with the content of legal rules rather than the process by which rules are created. The analytical separation of law by its formative process has resulted in an almost exclusive focus on the allocative efficiency of legal entitlements. According to this view, legal rights are treated as "commodities" that people (absent transaction costs and wealth effects) can freely buy and sell, such that the rights are allocated to their highest valued use. In this thesis, I maintain that this conventional approach needs to be integrated with a complementary, process-oriented analysis, capable of accounting for the causal relationship between the efficiency of legal rules and the efficiency of the lawmaking process. The central hypothesis of the present research is that the efficiency of the law-making process is not neutral with respect to the efficiency of the rules: the more efficient the process is in dealing with the pervasive information and public choice problems inherent in the production of legal rules, the better the outcome will be from an efficiency standpoint.Once this logic is recognized, the problem of legal efficiency becomes one of identifying the comparative advantages and disadvantages of alternative sources of law. Based on these premises, this thesis has two ambitious purposes: (i) to develop a methodology for the analysis of alternative lawmaking institutions, based on the idea of "process efficiency" and a unified taxonomy of lawmaking costs, and (ii) to provide a comparative analysis of alternative lawmaking processes (i.e., politics, bureaucracy, adjudication and spontaneous lawmaking), with the purpose of identifying their relative advantages and disadvantages in various regulated environments. The ultimate goal is to advance the understanding of the relationship between lawmaking mechanisms and the efficiency properties of legal rules and, hence, to offer a more refined toolbox for identifying efficiency improvements in the organization of the sources of law.S.J.D