Responses of law and economics to the threat of its initial success
Law and economics’ initial success has been under threat for some time now. Why is that? How has this threat been responded to? And how convincing are these responses? An important reason why law and economics is under threat is that empirical research has demonstrated that the functioning of the law cannot be well understood on the basis of the assumption of the rational actor and that policies based on this assumption are likely to be flawed. Since this criticism goes to the heart of law and economics, it has not gone unnoticed. Three responses can be distinguished. Whereas the first response maintains that the limitations attributed to the rational actor are grossly exaggerated and can easily be incorporated in rational choice theory, the second response welcomes the criticism and sees it as an opportunity to come up with an integrative theory of law and behavior. The third response also takes the criticism seriously but replaces the aspiration to come up with such an integrative theory with an approach that is sensitive to context-specific conceptions of rationality. It will be argued that the first two responses fall short, while the third response offers a promising way to go forward.