What does Tyler know about law and economics, anyway?
Over at Crooked Timber, Tyler Cowen comments on Steve Teles’ book on conservative legal movements. I never get tired of plugging Steve’s book (as he knows), so I’ll do it again here: It’s a great book, a riveting read, and instructive, to boot. Buy a copy today!
Tyler comments (among a series of comments in an ongoing Crooked Timber symposium 0n the book) on the section of the book on law and economics. It’s about a third of the book (and of course it’s the most interesting third!), but over at Crooked Timber, as near as I can tell, they have no one who actually, you know, does law and economics to comment on the book, and only Tyler who comes close.
Tyler is a great blogger, a great economist, and a great eater, among other things. On this, however, Tyler doesn’t do a very good job.
Here’s the key part (for me) of his post:
I view the relatively conservative nature of the law and economics movement as a historical accident which is already more or less obsolete. For better or worse, the wave of the future is scholars such as Cass Sunstein, not Henry Manne. The simple lesson is simply that in the long run “mainstream” usually wins out, even if the efforts of Henry Manne shifted or accelerated what later became mainstream trends.
One topic which interests me is how the “conservative” law and economics movement, as it is found in legal academia, differs from “market-oriented” economics, as it is found in the economics profession. The “right wing” economist and legal scholar will agree on many issues but you also will find fundamental variations in their temperament and political stances.
Market-oriented economists tend to be libertarian and it is rare that they have much respect for the U.S. Constitution beyond the pragmatic level. The common view is that while a constitution may be better than the alternatives, it is political incentives which really matter. James M. Buchanan’s program for a “constitutional economics” never quite took off and insofar as it did it has led to the analytic deconstruction of constitutions rather than their glorification. It isn’t hard to find libertarian economists who take “reductionist” views of constitutions and trumpet them loudly.
The conservative wing of the law and economics movement, in contrast, often canonizes constitutions. Many law and economics scholars build their reputations from studying, interpreting, or defending the U.S. Constitution. You don’t get to higher political or judicial office by treating a constitution in purely economic terms.
What I don’t understand is who these “conservative” law and economics scholars are. OK, I know a couple. But if the relevant distinction for Tyler is between “conservative” and “market-oriented,” I’d hold the law and economics stalwarts up to Tyler’s favored economists any day. In what fashion are the following people”conservative” and not “market-oriented”? Henry Manne, Paul Mahoney, Dick Posner (in the old days), Frank Easterbrook, Dan Fischel, Josh Wright, Ed Kitch, Bill Landes, Henry Butler, Richard Epstein, George Priest, Alan Schwartz, Roberta Romano, etc., etc.
Moreover, among these–just the first few who popped into my head–I’d say only one is known for any really significant constitutional analysis–and it’s hardly reverence, at that. To be sure, these folks are trained in the law, and take institutions seriously. The Constitution is a pretty important part of the institutional landscape in the US. Taking it seriously is a part of taking the law seriously. Fetishizing it–that’s different. But I know very few law and economics scholars who fetishize the Constitution. Liberal legal scholars–even some liberal economists? Absolutely. Law and economics scholars? Not so much. So–who are the law and economics scholars who built “their reputations from . . .defending the U.S. Constitution?”
Finally, Tyler claims that the students at GMU Law are just like law students everywhere–with no greater an appreciation for the Coase Theorem or moral hazard than law students anywhere else. If that is true–and it may well be true; certainly GMU Law seems to be losing its clear focus on law and economics–it is a change from the days when my dad was dean. The goal (and as far as I know it was achieved) was that the students at GMU would have a very different experience and training than law students elsewhere, with the possible exception of Chicago. If Tyler’s students don’t reflect this, I’d say things have changed. Or else it’s self-selection–a concept that any self-respecting George Mason Law student would well understand.