Economic consequences for lawyers
Beyond the jurisprudential preface
This article moves from the premise that a bilateral relationship between law and economics requires the contribution of
the theory of legal argumentation. The article shows that, to be legally relevant, economic consequences have to be incorporated into
interpretive arguments. In this regard, the jurisprudential preface strategy proposed by Craswell goes in the right direction, but begs the
question of why the legally relevant consequences have to be assessed in terms of total welfare maximization instead of, in the EU context
at least, consumer welfare maximization. After having identified five points of divergence between total and consumer welfare approaches,
the article draws from legal inferentialism to propose an analytical tool – the explanatory scorekeeping model – for assessing the
explanatory power of these two approaches. The model is then applied to the reasoning in United Brands Company v.
Commission.
Article outline
- 1.Introduction
- 2.The foundations of the economic approach to law
- 3.The analytical model of legal argumentation
- 4.Lawyers need legally relevant economic consequences
- 5.Which argument from economic consequences? Conceptual divergences between total and consumer welfare approaches
- i.Who is harmed by anti-competitive behaviour?
- ii.Do wealth transfers count? And if so, why?
- iii.Is the deadweight-loss calculated? And if so, why?
- iv.Is the elasticity of demand calculated? And if so, why?
- v.Which sanctions? How are they calculated?
- 6.Which argument from economic consequences? Methodological considerations
- 7.Which argument from economic consequences? The example of United Brands
- 8.Conclusions
- Notes
-
References
References (69)
References
Alchourrón, Carlos E. and Eugenio Bulygin. 1971. Normative Systems. Wien: Springer. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Alexy, Robert. 1978. Theorie der juristischen Argumentation. Die Theorie des rationalen Diskurses als Theorie der juristischen Begründung. Frankfurt am Main: Suhrkamp.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Armour, John, Henry Hansmann, Reiner Kraakman and Mariana Pargendler. 2017. What Is Corporate Law? In R. Kraakman et al.. The Anatomy of Corporate Law, 3rd ed. Oxford: Oxford University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Averitt, Neil W. and Robert H. Lande. 1997. Consumer Sovereignty: A Unified Theory of Antitrust and Consumer Protection Law. Antitrust Law Journal 651: 713–756.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Ayal, Adi. 2014. Fairness in Antitrust: Protecting the Strong from the Weak. Oxford: Hart Publishing.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Brandom, Robert. 1994. Making It Explicit: Reasoning, Representing, and Discursive Commitment. Cambridge and London: Harvard University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Brandom, Robert. 2000. Articulating Reasons: An Introduction to Inferentialism. Cambridge and London: Harvard University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Beccaria, Cesare. 1764. Dei delitti e delle pene. Livorno: Marco Coltellini.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Beck, Gunnar. 2013. The Legal Reasoning of the Court of Justice of the EU. Oxford: Hart Publishing.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Bengoetxea, Joxerramon. 1993. The Legal Reasoning of the European Court of Justice: Towards a European Jurisprudence. Oxford: Clarendon Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Bridgeman, Curtis. 2009. Contracts as Plans. University of Illinois Law Review 20091: 341–401.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Buchanan, James M. 1974. Good Economics. Bad Law. Virginia Law Review 601: 483–492. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Calabresi, Guido. 1970. The Cost of Accidents: A Legal and Economic Analysis. New Haven: Yale University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Calabresi, Guido. 2016. The Future of Law and Economics. Essays in Reform and Recollection. New Haven: Yale University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2005. Interpretive Scorekeeping. In R. Guastini and P. Comanducci (eds.), Analisi e diritto 2005, pp. 81–97. Turin: Giappichelli.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2007. On Legal Inferentialism. Toward a Pragmatics of Semantic Content in Legal Interpretation? Ratio Juris 201: 32–44. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2008. On the Contrary: Inferential Analysis and Ontological Assumptions of the A Contrario Argument. Informal Logic 281: 31–43. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2009. The A Simili Argument: An Inferentialist Setting. Ratio Juris 221: 499–509. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2010. What is the Reason for This Rule? An Inferential Account of the Ratio Legis. Argumentation 241: 197–210. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Canale, Damiano and Giovanni Tuzet. 2011. Use and Abuse of Intratextual Argumentation in Law. Cogency. Journal of Reasoning and Argumentation 31: 33–52.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Carbonell, Flavia. 2013. Reasoning by Consequences: Applying Different Argumentation Structures to the Analysis of Consequentialist Reasoning in Judicial Decisions. In C. Dahlman and E. Feteris (eds.), Legal Argumentation Theory: Cross-Disciplinary Perspectives, pp. 1–19. Dordrecht: Springer. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Coleman, Jules L. 2001. The Practice of Principle: In Defence of a Pragmatist Approach to Legal Theory. Oxford: Oxford University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Craswell, Richard. 1993. Default Rules, Efficiency, and Prudence. Southern California Interdisciplinary Law Journal 31: 289–302.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Cseres, Katherine. 2007. The Controversies of the Consumer Welfare Standard. The Competition Law Review 31: 121–173.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Cserne, Peter. 2012. Consequence-Based Arguments in Legal Reasoning: A Jurisprudential Preface to Law and Economics. In K. Mathis (ed.), Efficiency, Sustainability, and Justice to Future Generations, pp. 31–54. Berlin: Springer. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Demsetz, Harold. 1969. Information and Efficiency: Another Viewpoint. The Journal of Law & Economics 121: 1–22. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Driesen, David and Richard P. Malloy. 2017. Critiques of Law and Economics. In F. Parisi (ed.), The Oxford Handbook of Law and Economics. Volume 1: Methodology and Concepts. Oxford: Oxford University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Dworkin, Ronald. 1980. Is Wealth a Value? The Journal of Legal Studies 9(2): 191–226. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Epstein, Richard A. 2013. Harmonization, Heterogeneity and Regulation: CESL, the Lost Opportunity for Constructive Harmonization. Common Market Law Review 501: 207–224.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2013. Alcune note su di un approccio economico ordinalista allo studio del diritto. Ars Interpretandi 2013/21: 151–183.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2016. Efficienza paretiana ed efficienza allocativa. Considerazioni teoriche per giuseconomisti. Materiali per una storia della cultura giuridica 2016/11: 225–236.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2017a. Alcune note sui disaccordi teorico-interdisciplinari del diritto con l’economia. Rivista Internazionale di Filosofia del Diritto 2017/11: 91–117.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2017b. How The Behavioural Turn In Law And Economics Vindicates The New Haven School. Oeconomia 7(3): 375–406. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2018. Law and Economics United in Diversity: Minimalism, Fairness, and Consumer Welfare in EU Antitrust and Consumer Law (PhD Thesis). Fiesole: European University Institute.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. 2020. Reverse Engineering Legal Reasoning. In P. Cserne and F. Esposito (eds.), Economics in Legal Reasoning, pp. 139–154. London: Palgrave. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio. Forthcoming. Uniting Law and Economics in Diversity. Cheltenham, UK: Edward Elgar.
Esposito, Fabrizio and Lucila De Almeida. 2017. A Shocking Truth for Law and Economics: Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. In K. Mathis and B. Huber (eds.), Energy Law and Economics in Europe, pp. 101–133. Cham: Springer.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Esposito, Fabrizio and Stefan Grundmann. 2017. Investor-Consumer or Overall Welfare: Searching for the Paradigm of Recent Reforms in Financial Services Contracts. EUI Law Department Research Paper Series 2017/51.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Feteris, Eveline. 2005. The Rational Reconstruction of Argumentation Referring to Consequences and Purposes in the Application of Legal Rules: A Pragma-Dialectical Perspective. Argumentation 191: 459–470. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Garoupa, Nuno, Carlos Gómez Ligüerre and Lela Mélon. 2017. Legal Origins and the Efficiency Dilemma. London: Routledge.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Geradin, Damien, Anne Layne-Farrar and Nicholas Petit 2012. EU Competition Law and Economics. Oxford: Oxford University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Jolls, Christine, Cass R. Sunstein and Richard H. Thaler. 1998. Theories and Tropes: A Reply to Posner and Kelman. Stanford Law Review 501: 1593–1608. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Kaplow, Louis. 2012. On the Choice of Welfare Standards in Competition Law. In D. Zimmer (ed.), The Goals of Competition Law, pp. 3–26. Cheltenham, UK: Edward Elgar. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Kaplow, Louis and Steven Shavell. 2002. Fairness versus Welfare. Cambridge and London: Harvard University Press.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Kraus, Jody S. 2001. Reconciling Autonomy and Efficiency in Contract Law: The Vertical Integration Strategy. Philosophical Issues 111: 420–441. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Landes, William M. 1983. Optimal Sanctions for Antitrust Violations. The University of Chicago Law Review 501: 652–678. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
MacCormick, Neil and Richard S. Summers (eds.). 1991. Interpreting Statutes: A Comparative Study. Aldershot: Dartmouth.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Monti, Giorgio. 2007. EC Competition Law. Cambridge: Cambridge University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Navarro, Pablo E. and Jorge L. Rodríguez. 2014. Deontic Logic and Legal Systems. Cambridge: Cambridge University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Nazzini, Renato. 2011. The Foundations of European Union Competition Law: The Objective and Principles of Article 102. Oxford: Oxford University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Ogus, Anthony. 2010. Law And Economics in The Legal Academy, or, What I Should Have Said to Discipulus. University of Toronto Law Journal 601: 169–175. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Papayannis, Diego M. 2013. Spiegazione funzionale e analisi concettuale. Sull’incidenza dei modelli economici nello studio della pratica giuridica. Ars interpretandi 2013/21: 69–109.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Patterson, Dennis. 2005. Interpretation in Law. San Diego Law Review 421: 685–709.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Posner, Richard A. 1979. Some Uses and Abuses of Economics in Law. The University of Chicago Law Review 461: 281–306. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Posner, Richard A. 1985. Wealth Maximization Revisited. Notre Dame Journal of Law, Ethics & Public Policy 2(1): 85–105.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Posner, Richard A. 2001. Antitrust Law, 2nd ed. Chicago: University of Chicago Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Posner, Richard A. 2015. Norms and Values in the Economic Approach to Law. In A. Hatzis and N. Mercuro (eds.), Law and Economics: Philosophical Issues and Fundamental Questions, pp. 1–15. London: Routledge. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Sankari, Suvi. 2013. European Court of Justice Legal Reasoning in Context. Amsterdam: Europa Law Publishing.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Sarmiento, Daniel. 2012. The Silent Lamb and the Deaf Wolves: Constitutional Pluralism, Preliminary References and the Role of Silent Judgments in EU Law. In M. Avbelj and J. Komárek (eds.), Constitutional Pluralism in the European Union and Beyond, pp. 285–317. Oxford: Hart.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Smith, Adam. 2007. An Inquiry into the Nature and Causes of The Wealth of Nations. Hampshire, UK: Harriman House. Original ed. 1776.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Tuori, Karlo. 2015. European Constitutionalism. Cambridge: Cambridge University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Tuzet, Giovanni. 2019. Calabresi and Mill: Bilateralism, Moral Externalities and Value Pluralism. Global Jurist 19(3): 1–8. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
von Wright, Georg H. 1963. Norm and Action. A Logical Enquiry. London: Routledge & Kegan Paul.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Walton, Douglas. 2009. Dialectical Shifts Underlying Arguments from Consequences. Informal Logic 291: 54–83. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Wils, Wouter P. J. 2006. Optimal Antitrust Fines: Theory and Practice. World Competition 29(2): 183–208.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Wróblewski, Jerzy. 1974. Legal Syllogism and Rationality of Judicial Decision. Rechtstheorie 51: 33–46.![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Zamir, Eyal and Doron Teichman. 2018. Behavioural Law and Economics. Oxford: Oxford University Press. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Zhou, Qi. 2017. What Can Economists Learn from Contract Lawyers? In S. E. Weishaar, N. Phillipsen and W. Xu (eds.), Regulatory Reform in China and the UK. A Law and Economics Perspective, pp. 117–138. Cheltenham, UK: Edward Elgar. ![DOI logo](https://benjamins.com/logos/doi-logo.svg)
![Google Scholar](https://benjamins.com/logos/google-scholar.svg)
Cited by (2)
Cited by two other publications
Tuzet, Giovanni & Fabrizio Esposito
2023.
Preponderance, proportionality, stepwise liability.
The International Journal of Evidence & Proof 27:4
► pp. 325 ff.
![DOI logo](//benjamins.com/logos/doi-logo.svg)
Khokhlova, Alina Dmitrievna, G.I. Muromtsev & S.B. Zinkovskii
2021.
Application of V. Pareto’s economic efficiency criterion in Russian judicial practice.
SHS Web of Conferences 118
► pp. 01013 ff.
![DOI logo](//benjamins.com/logos/doi-logo.svg)
This list is based on CrossRef data as of 4 july 2024. Please note that it may not be complete. Sources presented here have been supplied by the respective publishers.
Any errors therein should be reported to them.