Efficiency, Utility, and Wealth Maximization
A fully adequate inquiry into the foundations of the economic approach to law would address at least the following four related questions:
- What is economic efficiency; what does it mean to say that resources are allocated in an economically efficient manner or that a body of law is efficient?
- Does the principle of efficiency have explanatory merit; that is, can the rules and principles of any or all of the law be rationalized or subsumed under an economic theory of legislation or adjudication?
- How should law be formulated to promote efficiency; in what ways must legal rights and duties be assigned and enforced so that the rules that assign and enforce them are efficient?
- Ought the law pursue economic efficiency; to what extent is efficiency a desirable legal value in particular, and a normatively attractive principle in general?
Published in: Hofstra Law Review