Legal Theory Blog

Edwards on Narrative & Legal Authority

Linda H. Edwards (William S. Boyd School of Law, UNLV) has posted Once Upon a Time in Law: Myth, Metaphor, and Authority on SSRN. Here is the abstract:

We have long accepted the role of narrative in fact statements and jury arguments, but in the inner sanctum of analyzing legal authority? Surely not. Yet cases, statutes, rules, and doctrines all have stories of their own. When we talk about legal authority, using our best formal logic, we are actually swimming in a sea of narrative, oblivious to the water around us. As the old Buddhist saying goes, 'we don’t know who discovered the ocean, but it probably wasn’t a fish.'

This article teases out several familiar archetypes hidden in discussions of cases and statutes. In the midst of seemingly routine law talk are stories of birth and death, battle and betrayal, tricksters and champions. These stories are simultaneously true and false, world-shaping yet always incomplete. Their unnoticed influence over the law’s development can be powerful. But we so seldom question familiar narratives, and these archetypes practically run in our veins. We should learn to recognize and interrogate these stories, attuned to their truths, alert to their limitations, and ready when necessary to seek other more accurate and complete stories for the law.

Cali & Wyss on Democratic Compliance with Human Rights Judgments

Basak Cali & Alice Wyss (University College London , University College London and University College London) have posted Why Do Democracies Comply with Human Rights Judgments? A Comparative Analysis of the UK, Ireland and Germany on SSRN. Here is the abstract:

Recent literature on compliance has proposed different answers to whether being a democracy matters in fulfilling international commitments. A central focus of these studies was whether democratic institutions enhance or hinder compliance. Scholars have studied both the positive effects of democratic accountability and the negative effects of democratic popular pressure on compliance.Different strands of literature suggest an apparent disagreement about whether democracies are more or less likely to comply with human rights commitments and what reasons motivate their compliance. In this paper, we explore the relationship between democratic institutional qualities and human rights commitments, by employing different methods and new data. We study democracy as a dependent variable rather than an independent variable affecting human rights compliance. We submit that democracies have a number of objective institutional properties, but we also emphasise that institutional properties have different prominence in different contexts. We claim that the ideas that states have of their own democracy play an important role in determining the motivations for compliance with human rights commitments. We focus on reasons for democratic compliance with a particularly institutional form of human rights commitment: human rights judgments and rely on rich qualitative data based on elite interviews carried out in Germany, the UK and Ireland.

Bryant on Faigman on Constitutional Fictions

Christopher Bryant (University of Cincinnati - College of Law) has posted The Empirical Judiciary (Constitutional Commentary, Vol. 26, 2009) on SSRN. Here is the abstract:

This essay reviews David L. Faigman’s Constitutional Fictions: A Unified Theory of Constitutional Facts (Oxford U.P. 2008). Constitutional Fictions is a highly original book that promises to (and should) have an enormous impact on both constitutional law scholarship and practice. The book focuses on the methods, or lack thereof, that the Court employs in receiving evidence and resolving disagreements about questions of fact in constitutional cases. In doing so, the book does the legal profession an invaluable service by identifying and articulating the many frequently unspoken questions that arise in the context of judicial consideration and resolution of legislative facts in constitutional cases. The book also documents the largely unremarked ubiquity of these questions, the wide variety of circumstances in which they occur, and the depth of the theoretical issues they implicate. Professor Faigman accomplishes all this in crisp, lucid, and admirably concise prose. Nor could Professor Faigman’s book be more timely. Several of the Roberts Court’s most salient and controversial constitutional decisions have turned on questions of legislative fact.

Constitutional Fictions treats an important topic with impressive insight. But it will not be the last word on the subject. When Constitutional Fictions finally comes round to normative and prescriptive analysis of the status quo, Faigman shies away from the broader implications of his critique. After reviewing Professor Faigman’s arguments, this review essay explores how alternative analyses might compel more sweeping changes than he suggests.

Bayazitova & Shivdasani on TARP

Dinara Bayazitova and Anil Shivdasani (University of North Carolina and University of North Carolina) have posted Assessing TARP on SSRN. Here is the abstract:

We show that capital infusions under the Troubled Asset Relief Program (TARP) were provided to banks most likely to pose systemic risk, were exposed to funding uncertainties in volatile capital markets, had weak capital structures, but had sound loan portfolios compared to banks that did not receive TARP infusions. Announcements of TARP capital infusions had a sharply positive effect on valuations of recipient banks, particularly for larger and earlier recipients, and those with higher credit losses and asset write-downs. Data from banks that chose not to participate in TARP suggests that the value enhancement from TARP capital arises from lowered financial distress costs, and not from a certification effect of TARP. Recently, costs of participating in TARP have increased significantly for banks due to deteriorating political sentiment. We show that the passage of H.R. 1586 imposing punitive taxes on employee bonuses at TARP recipients led to sharply negative excess returns for affected banks. Recent announcements of banks withdrawing from TARP led to significant valuation gains.

Chesterman & Fisher on Outsourcing of Public Services

Simon Chesterman and Angelina Fisher (New York University - School of Law, Singapore Programme and New York University - School of Law) have posted Private Security, Public Order: The Outsourcing of Public Services and Its Limits (Introduction) (PRIVATE SECURITY, PUBLIC ORDER: THE OUTSOURCING OF PUBLIC SERVICES AND ITS LIMITS, pp. 1-7, Simon Chesterman and Angelina Fisher, (eds.), Oxford University Press, 2009) on SSRN. Here is the abstract:

Private actors are increasingly taking on roles traditionally arrogated to the state. Both in the industrialized North and the developing South, functions essential to external and internal security and to the satisfaction of basic human needs are routinely contracted out to non-state agents. In the area of privatization of security functions, attention by academics and policy makers tends to focus on the activities of private military and security companies, especially in the context of armed conflicts, and their impact on human rights and post-conflict stability and reconstruction. The first edited volume emerging from New York University School of Law's Institute for International Justice project on private military and security companies, "From Mercenaries to Market: The Rise and Regulation of Private Military Companies" broadened this debate to situate the private military phenomenon in the context of moves towards the regulation of activities through market and non-market mechanisms.

Where that first volume looked at the emerging market for use of force, this second volume looks at the transformations in the nature of state authority. Drawing on insights from work on privatization, regulation, and accountability in the emerging field of global administrative law, the book examines private military and security companies through the wider lens of private actors performing public functions. In the past two decades, the responsibilities delegated to such actors - especially but not only in the United States - have grown exponentially. The central question of this volume is whether there should be any limits on government capacity to outsource traditionally "public" functions. Can and should a government put out to private tender the fulfilment of military, intelligence, and prison services? Can and should it transfer control of utilities essential to life, such as the supply of water? This discussion incorporates numerous perspectives on regulatory and governance issues in the private provision of public functions, but focuses primarily on private actors offering services that impact the fundamental rights of the affected population.

Pardo on Walton on Witness Testimony Evidence

Michael S. Pardo (University of Alabama School of Law) has posted Review - 'Witness Testimony Evidence: Argumentation, Artificial Intelligence, and Law' by Douglas Walton (Notre Dame Philosophical Reviews 2008) on SSRN. Here is the abstract:

This review essay discusses Douglas Walton's recent book, Witness Testimony Evidence (Cambridge University Press, 2007). The book examines how testimony functions as evidence in law, and it explores various ways in which the structure of testimonial evidence (and the inferences drawn from it) may be modeled formally. The book also discusses the philosophical issues underlying the formal models as well as those underlying reasoning from testimonial evidence more generally. This essay situates the book's analysis within evidence scholarship, summarizes its chapters, and discusses some important limitations on the type of formal analysis pursued.

Legal Theory Lexicon: Social Welfare Functions

Introduction

One of the key ideas in contemporary economic theory in general and law and economics in particular is the social welfare function. Law students without a background in economics might be put off by the fact that social welfare functions are expressed in mathematical notation, but there is no reason to be intimidated. The basic ideas are easily grasped and the mathematical notation can be mastered in just a few minutes. This post provided an introduction to the idea of the social welfare function for law students, especially first year law students, with an interest in legal theory. Here we go!

Background

Normative Economics

The idea of a social welfare function is part of normative economics. There are several plausible formulations of normative economics, but almost all of normative economics begins with the fundamental idea of utility as a conception or measure of the good. Economists may disagree about the nature of utility, the relationship of utility to social welfare, and the role of welfare in public policy, but most (if not all) economists would assent to the abstract proposition that ceteris paribus more utility is a good thing. But this apparent agreement is at a very abstract and ambiguous level. There are many different ideas about what "utility" is.

Cardinal and Ordinal Interpretations of Utility

One key divide is between cardinal and ordinal interpretations of utility. An ordinal utility function for an individual consists of a rank ordering of possible states of affairs for that individual. An ordinal function tells us that individual i prefers possible world X to possible world Y, but it doesn't tell us whether X is much better than Y or only a little better.

A cardinal utility function yields a real-number value for each possible state of affairs. If we assume that utility functions yield values expressed in units of utility or utiles, then individual's utility function might score possible world P at 80 utiles and possible world Q at 120 utiles. We might represent the utility function U of individual i for P and Q as follows:

Ui(P) = 80

Ui(Q) = 120

The distinction between cardinal and ordinal utilities is potentially important for utilitarianism, at least on certain interpretations. As a theory of evaluation, utilitarianism is the view that an action is the best action if and only if the action maximizes utility when compared with all possible alternative actions. For technical reasons, utilitarianism requires both cardinality and full interpersonal comparability. This point about utilitarianism is closely related to the history of welfare economics, the explicitly normative branch of economic theory.

Measurement Problems

Both cardinality and interpersonal comparability pose measurement problems for economists. Even in the case of a single individual, it is difficult to reliability measure cardinal utilities. Measurements that support interpersonal comparisons are even more difficult to justify, and cardinal interpersonal comparisons seem to require the analyst (the person making the comparison) to make a variety of controversial value judgments. Market prices won't do as a proxy for utility, for a variety of reasons including wealth effects. The challenge for welfare economics was to develop a methodology that yields robust evaluations but does not require the use of cardinal interpersonally comparable utilities.

Pareto

This is the point at which Pareto arrives on the scene. Suppose that all the information we have about individual utilities is ordinal and non-interpersonally comparable. In other words, each individual can rank order states of affairs, but we (the analysts) cannot compare the rank orderings across persons. The weak Pareto principle suggests that possible world (state of affairs) P is socially preferable to possible world (state of affairs) Q, if everyone's ordinal ranking of P is higher than their ranking of Q. Weak Pareto doesn't get us very far, because such unanimity of preferences among all persons is rare. The strong Pareto principle suggests that possible world (state of affairs) P is socially preferable to possible world (state of affairs) Q, if at least one person ranks P higher than Q and no one ranks Q higher than P. Unlike weak Pareto, strong Pareto does permit some relatively robust conclusions.

The New Welfare Economics

The so-called new welfare economics was based on the insight that market transactions without uncompensated negative externalities satisfy strong Pareto. If the only difference between state P and state Q is that in P, individuals i1 and i2 engage in an exchange (money for widgets, chickens for shoes) where both prefer the result of the exchange, then the exchange is Pareto efficient. A state of affairs where no further Pareto efficient moves (or trades) are possible is called Pareto optimal. The assumption about externalities is, of course, crucial. If there are negative externalities of any sort, then the trade is not Pareto efficient.

Weak Pareto and the Arrow Impossibility Theorem

Weak Pareto plus ordinal utility information allows some social states (or possible worlds) to be ranked on the basis of everyone's preferences. A method for transforming individual utility information into such a social ranking is called a social welfare function. Kenneth Arrow's famous impossibility theorem demonstrates that it is impossible to construct a social utility function that can transform individual ordinal rankings into a social ranking in cases not covered by weak Pareto, if certain plausible assumptions are made. Arrow's theorem has spurred two lines of development in welfare economics. One line of development relaxes various assumptions that Arrow made; for example, we might relax Arrow's assumption that the social ranking must be transitive (if X is preferred to Y and Y is preferred to Z, then X must be preferred to Z). The other line of development considers the possibility of allowing information other than individual, noncomparable ordinal utilities. It is this second line of development that is relevant to the use of social welfare functions in contemporary law and economics.

Social Welfare Functions

Suppose that we allow full interpersonal comparability and cardinal utility information. This is sufficient to support what are called Bergson-Samuelson utility functions, which have the form:

W(x) = F (U1(x), U2(x), . . . UN(x))

Where

W(x) represents a real number social utility value for some state of affairs (or possible world) X,

F is some increasing function that yields a real number,

U1(x) is a cardinal, interpersonally comparable utility value yielded by some procedure for individual 1 for state of affairs X, and

N is the total number of individuals.

Bergson-Samuelson social welfare functions are named after Paul Samuelson and Avram Bergson.

What Are the Plausible Social Welfare Functions?

There are a variety of different possible functions that can be substituted for F. Here are some of the most important possibilities:

Classical-utilitarian SWF--We could substitute summation for F, and simply add the individual utility values; this is sometimes called a Benthamite or classical-utilitarian social welfare function famously associated with Jeremy Bentham. The classical utility social welfare function can be represented as follows:

W(x)={U1(x) + U2(x) + U(3(x) . . . Un(x)}

Average-utilitarian SWF--The classical SWF adds the utilities. This raises some very interesting issues when the different states of the world (x or y) have different population sizes. When deciding whether to add additional individuals, the classical-utilitarian SWF says more is better until we reach the point where adding more actually reduces the overall level of utility. One way to avoid this implication is use the average level of utility instead of the sum, as in the following formula:

W(s){[U1(x) + U2(x) + U(3(x) . . . Un(x)]/n}

In other words, we divide the sum of utilities by the number of individuals!

Bernoulli-Nash SWF--In the alternative, we could substitute the product function (¡Ç) and multiply individual utilities. This is sometimes called a Bernoulli-Nash social welfare function, which can be represented as follows:

W(x)={U1(x) * U2(x) * U(3(x) . . . Un(x)}

Rather than adding individual utilities, we multiply them! And yes, the "Nash" in Bernoulli-Nash is John Nash of "A Beautiful Mind" fame.

What About the Problem of Interpersonal Comparison?

Social welfare functions are much discussed in legal theory these days. One of the reasons for the contemporary debate over social welfare functions is that this approach has been championed by Louis Kaplow and Steven Shavell (both of the Harvard Law School). Their book, Welfare versus Fairness, has put the welfarist approach to normative economics "front and center."

One of the interesting theoretical questons about SWFs concerns the problem of interpersonal comparison. How do we get the values to plug into U1(x), U2(x), and so forth. That is, how do we compare up with a way of putting my utility and your utility on the same scale. As I understand the state of play, this is not a topic on which economists agree. Some economists believe that there is no objective way of producing interpersonally comparable cardinal utility values. But some economists believe that a third-party (the legal analyst or the economist) can do the job of assigning values to individual utilities.

Conclusion

We've barely begun to scratch the surface of the many interesting theoretical issues that attend the use of social welfare functions in legal theory. Some of those issues were explored in a prior Legal Theory Lexicon entry on Balancing Tests. Even if you have absolutely no background in economics, there is no reason to shy away from the debates about social welfare functions. The notation, although at first intimidating, is actually very simple. The foundational ideas, although sometimes articulated in the jargon of economic theory, really go to fundamental questions in moral theory. I hope this post has given you the tools to begin to discuss these ideas!

Related Lexicon Entries

Legal Theory Lexicon 008: Utilitarianism

Legal Theory Lexicon 060: Efficiency, Pareto, and Kaldor-Hicks

Links

Social welfare function, Wikipedia

Bibliography

Kenneth J. Arrow, Social Choice and Individual Values (2d ed. 1963)

Abram Bergson, A Reformulation of Certain Aspects of Welfare Economics, 52 Quarterly Jounal of Economics 310 (1938).

John C. Harsanyi, Interpersonal Utility Comparisons, 2 The New Palgrave: A Dictionary of Economics, 955 (1987).

Lawrence Solum, Public Legal Reason, 92 Virginia Law Review 1449 (2006).

Kotaro Suzumura, Social Welfare Function, 4 The New Palgrave: A Dictionary of Economics, v. 4, 418-20 (1987).

(This entry was last modified on August 30, 2009.)

Legal Theory Bookworm

The Legal Theory Bookworm recommends The Unbounded Home: Property Values Beyond Property Lines by Lee Anne Fennell. Here is a description:

The Unbounded Home grapples with a core metropolitan reality -- that the value and meaning of a home extend beyond its property lines to schools, shops, parks, services, transportation, neighbors, neighborhood aesthetics, and even market conditions. Lee Anne Fennell unpacks the resulting tension between the homeowner’s desire for personal autonomy at home and the impulse to control what happens in surrounding areas to safeguard the home’s value.

 

The stakes are high; this conundrum carries implications for nearly every facet of residential life, including the many neighborhoods in the United States that are segregated by race and social class. Fennell shows how a new understanding of homeownership and  innovations that increase the flexibility of property law can address critical issues of neighborhood control and community composition that have been simmering unresolved for decades.

And from the reviews:

"Lee Anne Fennell is one of the most sophisticated property theorists writing today. She has produced a serious book, full of ideas that will change how we think about property, local government, and, most importantly, the home. Fennell shows brilliantly how one can reconfigure our current property arrangements so that they better align with the interests and incentives of homeowners living in a highly urbanized metropolitan area. The Unbounded Home is an extremely important and timely book. It brings our understandings of what property is and what it does up-to-date."-Richard C. Schragger, University of Virginia School of Law (Richard Schragger )

Essential for anyone interested in property theory.

Download of the Week

The Download of the Week is Reflective Equilibrium and Constitutional Method: Lessons from John McCain and the Natural Born Citizenship Clause by Mitchell N. Berman. Here is the abstract:

How should we settle on a theory of constitutional interpretation? Take the debate over originalism. How should we determine which of the contending views is correct? Presumably, the correct view of constitutional interpretation must be at least consistent with the truth about other adjacent matters too - like, say, the nature of law. But how should we go about reaching the correct theory of constitutional interpretation in a manner that best ensures this consistency condition is satisfied?

A common approach, especially favored by some subset of contemporary originalists, is fairly described as foundationalist. For example, some originalists argue: that the practice of constitutional interpretation is the interpretation of a particular text; that interpretation just is the effort to ascertain the meaning that the text’s author intended to communicate; and therefore, that constitutional interpretation just is the effort to ascertain the meaning that the Constitution’s authors intended their text to communicate. Other originalists hold that originalism follows from the facts that a written constitution is designed to be authoritative or normatively binding and that law can have this authoritative character only by dint of the authority of its authors.

These are some ways to reason about constitutional interpretation, but not the only ones. This essay explores the possibility that we can draw lessons about candidate normative theories of constitutional interpretation by assigning a more prominent role than is customary to purportedly shared convictions about the proper legal resolution of particular cases. It does so by adapting the Rawlsian method of reflective equilibrium to the constitutional domain and by focusing, as a case study, on the question of whether Senator John McCain is constitutionally eligible to serve as President consistent with the Constitution’s Natural Born Citizenship Clause.

The method of reflective equilibrium maintains that our beliefs in a range of domains will be better justified if we seek coherence among considered judgments of general principles and of case outcomes, among other things, and that none of these different types of judgments is uniquely epistemically privileged: in principle, all judgments are revisable in light of all others. If this model applies to the constitutional domain, then the direction of argument between constitutional theory and constitutional case holdings would not be wholly unidirectional. While the correct outcomes in constitutional cases will often follow from applying the correct constitutional theory, the constitutional theory we deploy should itself be answerable to whatever strong considered judgments we may have about correct legal outcomes in particular cases.

The ambition to use strong intuitions or convictions about particular cases to drive (provisional and rebuttable) conclusions about interpretive constitutional theory might seem circular on the supposition that our legal judgments about cases should be the products, not the grounds, of our constitutional theories. But perhaps that need not always be true. And it is not true, I argue, with respect to the question of McCain’s eligibility for the presidency. In short, careful attention to the question of McCain’s eligibility might reorient our thinking about how to think about methods of constitutional interpretation more generally, and provides further basis to doubt originalism.

Highly recommended. Download it while its hot!

Salim on Legal Transplants in Post-Colonial States

Mohammad Rizal Salim (The University of Nottingham Malaysia campus) has posted Are Legal Transplants Impossible? (Journal of Comparative Law, Forthcoming) on SSRN. Here is the abstract:

The Malaysian case Soo Boon Siong @ Saw Boon Siong v Saw Fatt Seong & Soo Hock Seang provides evidence of the inherent impossibility of legal transplants. The impossibility in this case was not caused by differences of legal culture, but the inability of lawyers in a post-colonial state to keep pace with the increasing complexities of the law.