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Monday, March 5, 2007

Hayek on the Common Law
Mike Rappaport

Lately, I have been listening to Russ Roberts's podcast interviews of a variety of economists. I am quite enjoying them.

In an interesting podcast, Roberts intereviews Don Boudreaux about Hayek’s Law, Legislation and Liberty.  The two of them expound on Hayek’s conception of the role of the common law judge. They argue that the judge enforces the reasonable expectations of the parties that exist in their society, even if those expectations are not based on laws that are written down.

Boudreaux gives the example of a high school cafeteria, where individuals save their seats by putting their books down on a seat before they get in line for food. When they come back to their books, they reasonably expect that their seat will be “saved.” If someone had taken their seat, pushing their books aside, it would be the job of the common law judge to enforce their reasonable expectation that seats could be saved. 

This is a good example to illustrate Hayek’s conception of the common law, and it can be developed further than Boudreaux and Roberts do on the podcast to illustrate some other aspects of Hayek’s theory. First, Hayek claims that judges are limited to enforcing rules which can be known in advance, but this might be thought to be in tension with enforcing an unwritten law. This example shows that there need not be a tension. If judges are enforcing existing customs, they can enforce unwritten rules, without "making up" the law.  Second, Hayek also says that judges are not making policy. Here, judges are simply enforcing the customs that have developed.  Third, even though judge are not making policy, Hayek imagines common law judges as enforcing rules of conduct that should promote desirable outcomes.  Because Hayek believes that the customs that emerge tend to be desirable within an order, the enforcement of those customs and expectations will result in desirable rules, even though judges do not directly aim at developing a desirable rule.

The saving seats example can also be used to explicate the role of the judge when deciding close cases. Suppose that someone saves a seat while he goes outside of the school for 30 minutes to buy lunch. Or suppose that he attempts to save seats for his 2 friends who have not arrived yet.  In these cases, the judge must decide what may not be an entirely clear result.  The judge's first job here is not to figure out what he thinks the rule should be but what people believe the rule to be. What would people say about saving a seat for 30 minutes? If they would regard it as improper, then he should treat it that way as well. If the practice is not clear on this matter – if people who understand the practice disagree in about equal numbers as to the proper answer – then the judge will have decide what is reasonable. In doing so, he may consider what is more desirable, but this analysis of desirability will be limited in the sense that he will consider what is more desirable assuming the existence and desirability of the practice at issue as well as the remainder of the existing law. Thus, if he argued that the practice of saving seats was undesirable generally and therefore should be minimized and not applied to the 30 minute situation, that would be inappropriate.  Instead, he would have to accept the value choices of the law – that saving seats makes sense in at least the core circumstances – and then to reason out a desirable solution.

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Mike Rappaport
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Comments

Sometimes, the specific result reached is not as important as simply reaching a result, through a process that people have generally agreed upon. Whether the seat is saved for 30 minutes or only 15 doesn't matter so much as having a process in place to pick one side or the other when the parties can't work things out on their own. For that purpose, it doesn't matter so much whether the common law judge is making things up as he goes along or interpreting pre-existing custom. The only important thing then is that the rule, once articulated, be applied consistently in the future.

Posted by: PatHMV | Mar 5, 2007 7:59:28 PM

There's a Hayek's Law? That's unbelievable. I mean, I knew she was gorgeous, but all those looks and brains to back them up? That's hot.

Um, wait....we were talking about Salma Hayek, right?
http://www.salmahayekonline.com/

(Sorry, I couldn't resist.)

Posted by: brainy435 | Mar 5, 2007 8:23:26 PM

Mike,

Thanks for the motivation to listen to the Boudreaux interview whilst cycling tomorrow AM.

I discovered Econtalk about a month ago and have been cherry-picking my way through Russ Robert's remarkable podcast library. What a gift Russ have given us! At least for listeners looking for gems on economics -- I can't evaluate the law as you can.

If I may recommend others of the Econtalk series, I would highlight:

1) the two interviews with Bruce Bueno De Mesquita, which gave me some new insights into the behavior of politicians, from Castro to Kennedy. For those who are not interested in Podcasts, I've attempted a summary

http://seekerblog.com/archives/20070223/the-logic-of-political-survival

2) the interview with Nobel Laureate Robert Lucas:

http://www.econtalk.org/archives/2007/02/lucas_on_growth.html

While not the main topic, the Lucas comments on foreign aid research sent me off looking into Thomas Easterly [actually the combined comments of Lucas and Greg Mankiw - in another terrific Econtalk interview]. For those interested in the cluster of resource links I found, see:

http://seekerblog.com/archives/20070225/foreign-aid-vs-growth-robert-lucas-and-thomas-easterly

Steve

Posted by: SeekerBlog.com | Mar 6, 2007 4:43:22 AM

That sounds accurate enough for the origins of the common law - for a long time, the customs of the people concerned was law and was upheld as such. This is the origin of rules about the justiciability of cases involving the titles to land, or trespass, etc, among many other things.

The juries, in that time (ie up until around 1500) were summonsed to testify as to their knowledge of the customs according to which the parties ought to have comported themselves, and their knowledge of the parties.

The common law today is clearly far less flexible - one wonders if even to any extent we are concerned with enforcing reasonable expectations, apart from in the domain of equitable remedies, which Americans have forgotten are not really anything to with the common law.

Equitable remedies stem from the ability of aggrieved parties, and notably litigants, to seek redress unavailable from the courts, or indeed redress from the courts, by complaining to the Chancellor (and occasionally other officers). Even equity was not explicitly concerned with reasonable expectations until perhaps the 1700s, and now the reasonable expectations enforced by equity tend only to be those that are created by one party and relied on by another to the first party's knowledge.

So perhaps Hayek's perception of the common law was slightly exaggerated by the extent to which it may have seemed foreign to his continental eyes.

Posted by: Patrick Fitzgerald | Mar 6, 2007 11:39:30 AM