Neoclassical economics is inherently biased against progressive policies and therefore should be avoided by progressives seeking to make the case for them. This is reflected in the history of regulation of payday loans and other fringe financial products. Conservatives used economic arguments to roll back regulation of these products in the second half of the twentieth century. Attempts to reregulate them have since been stymied despite progressives’ use of behavioral economic arguments to justify greater regulation. Progressives who eschew economic argument have had more success pursuing reform in other areas in the Biden Administration. The failure of behavioral economics to advance a progressive agenda in fringe finance suggests that inframarginalism, which also embraces the neoclassical analytic, will not help progressives. Another problem is that any neoclassical approach privileges elite expertise.

Land is a major generator of gains from trade because it is fixed in quantity and arises naturally, resulting in low costs for sellers and high demand from buyers. The fixed quantity also allows policymakers to tailor prices or taxes to inframarginal units. But the current mode of redistributing the surpluses generated by land sales in America – the local property tax – has important drawbacks. These include the need for property value assessments, the fact that some homeowners lack the cash income required to pay the tax even when the assessment is accurate, and the fact that local administration means there is little redistribution from rich communities to poor ones. Taxing imputed rents as income at the federal level would address these problems. Imputed rent is the rent that a homeowner pays to himself for the right to live in the house. It is economically equivalent to a home’s value because home values are determined by the rents they command. Taxing them as federal income does not require home value assessments (local rental data suffice), ensures that tax rates vary with income, and leverages the mildly progressive federal income tax rate structure to redistribute wealth.

The growing numbers of women living with HIV begged a question: Why and how were women contracting HIV? Chapter 4, “Sex Bargains,” tracks the emergence of a new logic that centered heterosexual sex as the site of women’s vulnerability. Focusing in on the interpersonal negotiation before surrounding sex had a powerful effect: It obfuscated the role of structural responses to the epidemic, from housing to harm reduction, and instead focused public health interventions on individual behavior. This chapter follows an influential debate between law and economics scholars and feminist activists on the question of the sex bargain.

This chapter analyses the consequences of the paradigm shift from formalism to instrumentalism on the activity of legal scholarship. Under a traditional formalist conception, the activity of appellate courts in making and developing common law and the activity of legal scholars studying and writing about that lawmaking activity are in close harmony. The unifying feature of both endeavors is a mastery and an application of traditional formalist legal analysis. Both courts and legal scholars are focused on the process of deductively applying identified first principles to novel legal issues as a way of determining logically required resolutions of those issues. They are also both involved in the process of refining an established body of common law to accommodate new factual disputes as they arise and to incorporate the preferred resolution of novel issues.

The shift from formalism to instrumentalism profoundly disrupted this harmonious synergy. Much in the same way that the intellectual work of appellate courts changes fundamentally under instrumentalism, so too does the professional posture and responsibilities of legal scholars.

This chapter offers a comprehensive account of modern legal scholarship in the current instrumentalist era.

This book introduces a normative theory of property. Property laws and social norms are justified by whether and how well they secure natural rights. The natural rights are justified by run-of-the-mill principles of natural law, which evaluate human action by whether it helps people survive or flourish rationally. The book studies how natural rights legitimate property law in general and in specific doctrines. It also studies the main topics in property law and policy – ownership, public commons, the appropriate design of property rights, rights less sweeping than rights of ownership, property torts, regulatory takings, and eminent domain. The book studies in particular the phenomenon of practical reasoning, the sphere of moral reasoning that converts fundamental moral goals into specific laws and policies to enforce in practice. A theory of natural rights contributes importantly to normative theory beyond the theories most respected today – egalitarian or progressive theories, law and economics, and approaches the book calls pragmatic.

This chapter studies how property rights are protected and recognized in common law. In doctrine, substantive rights are not recognized expressly but indirectly. Rights are recognized via doctrines that prohibit wrongs to rights. Common law protects rights in this manner for practical reasons. Courts are better equipped to enforce duties between rights-holders and aggressors than they are to work out the full scope of rights, and when the law prohibits wrongs to rights, it leaves to people the freedom to do whatever does not violate the prohibitions. To secure rights, however, legal duties and prohibitions are structured as seems likely to secure rights. This chapter illustrates nuisance and tort suits over train sparks. Both doctrines secure to owners and occupants rights to use land. The harm, interference, and unreasonability elements of nuisance are structured to secure use rights, and sparks doctrine rules out contributory negligence to secure the same use rights. This way of thinking about rights and wrongs goes against contemporary law and economic scholarship, and this chapter contrasts law and economic studies of rights with the approach developed in this chapter.

This chapter describes two areas of legal theory that consider when means-based adjustments to legal rules may not be desirable. Under one perspective, means-based adjustments designed for redistributive purposes should be reserved for the tax system alone, since introducing means-based adjustments to other legal rules would entail greater efficiency costs. A second literature considers the desirability of a legal system that is impartial, nondiscriminatory, and general in its application. Subjecting taxpayers to different legal rules based on means could also undermine these important criteria. This chapter considers how means-based adjustments to the tax compliance rules should be evaluated from each of these perspectives, and why they would be justified even in cases where means-based adjustments to other legal rules would not be.

Historically, corporate governance arrangements arose out of the interactions of the various constituencies that form around corporations. American corporate law evolved to facilitate the bargaining and innovation that made up this governance market. Pursuant to the modern theory that corporate law is supposed to promote efficiency, rather than market activities, changes to the governance regime imposed a one-size-fits-all set of practices from outside the traditional governance market. The result has been a decline in the number of companies interested in joining America’s public markets, and the adoption, by those companies that do go public, of extreme governance structures designed to resist the influence of the governance industry.

Chapter 11 turns to a discussion of the competing arguments concerning the new public nuisance law advanced by practicing attorneys, interest group allies, judges, scholars, and law-and-economics professors. Almost all criticisms of the new public nuisance law have been negative, characterizing expansion of public nuisance law as illegitimate and dysfunctional. These critiques are examined through the lens of various categories of criticism: (1) traditional, (2) formal, (3) institutional, (4) rule of law, (5) democratic theory, and (5) law and economics. The critics all draw on negative examples from the mass tort public nuisance cases in the 21st century (lead paint, firearms, opioids, vaping, climate change). At least one commentator, however, has offered tempered praise for the new public nuisance law as the second best solution to community-wide harms. She believes that the development of the new public nuisance law is in the finest traditon of a flexible, developing common law to meet changed circumsatnces. This commentator would permit continued development of the new public nuisance law, enhanced with several guardrails and transparency in proceedings.

This chapter shows how thin the legal-economic analysis of property law has been and responds to a few particular arguments in that field, including arguments about the general structure of property law, adverse possession, and dead-hand control.

This chapter describes the motivations for an analytical, “internal” critique of the law-and-economics movement. In particular, it discusses earlier types of critiques and shows that, while they are probably successful on their own terms, they have done little to dislodge economic-style thinking as a dominant force in American private law. Instead, a critique on the law-and-economics movement’s own terms is needed. The chapter also identifies several recurring problems, or “antipatterns,” in legal-economic reasoning.

This chapter summarizes the problems of the law-and-economics movement and tries to outline new ways for economic thinking to make a more lasting contribution to law.

This chapter develops and critiques the major economic arguments in tort law, focusing mostly on the model of bilateral precaution, which attempts to analyze the foundational choice between negligence and strict liability. It also responds to “least-cost avoider” arguments and shows how little progress economic thinking has made in understanding most of tort law. The commonplace conclusion that tort law has easily succumbed to the law-and-economics movement is incorrect.

This chapter responds to leading arguments about contract remedies, including the theory of efficient breach, contract interpretation, rules of disclosure (or permitting nondisclosure), consideration, and other topics in contract law. It shows how little progress the law-and-economics movement has made in understanding most areas of contract law, despite the obvious connections between contracts and economics.