Publication: The Republic of Beliefs: A New Approach to ‘Law and Economics’
Date
2015-05
ISSN
Published
2015-05
Author(s)
Basu, Kaushik
Abstract
The discipline of law and economics
deals with wide-ranging topics, from competition and
environmental policy to crime control, and has been
instrumental in determining how an economy performs. Yet its
success has fallen short of its potential. The discipline’s
shortcomings are nowhere as visible as in developing
economies, where a common refrain is how the law looks good
on paper but does not get implemented. This paper
articulates a methodological flaw that underlies much of
contemporary law and economics, and argues that there is an
intimate connection between human beliefs and expectations,
on the one hand, and the effectiveness of the law, on the
other. I propose a new approach to law and economics that is
rooted in game theory and rectifies the flaw. It is argued
that this approach can open up new areas of research and be
marshalled to address some of the more pressing policy
challenges of our time.
Citation
“Basu, Kaushik. 2015. The Republic of Beliefs : A New Approach to ‘Law and Economics’. Policy Research Working Paper;No. 7259. © World Bank, Washington, DC. http://openknowledge.worldbank.org/handle/10986/21991 License: CC BY 3.0 IGO.”
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