The limits of liberalism: Good boundaries must be discovered

ADAM MARTIN

THE REVIEW OF AUSTRIAN ECONOMICS

Abstract: Determining good boundaries for governance jurisdictions is among the most difficult problems in political theory and political philosophy. But to whom the rules of a given jurisdiction applies is a problem that afflicts private as well as public governance. Clubs have boundaries no less than cities, states, or nations. This essay applies Hayek’s conception of competition as a discovery procedure to boundary problems, arguing that good jurisdictional boundaries are subject to a great deal of contingent variation according to particular the conditions of time and place. Philosophical speculation, therefore, cannot fully replace a trial and error process that facilitates social learning about where good boundaries fall. I outline the features of good boundaries that make them subject to such variation, then evaluate two criteria for evaluating whether existing jurisdictional boundaries are good: one that emphasizes ex ante consent to boundaries, and one that focuses on the ability of individuals to exit from jurisdictions ex post, arguing that the exit-focused approach is underappreciated.

Hume on Education

DAN O’BRIEN

PACIFIC PHILOSOPHICAL QUARTERLY

Abstract: Hume claims that education is ‘disclaimed by philosophy, as a fallacious ground of assent to any opinion’ (T 1.3.10.1) and that it is ‘never . . . recogniz’d by philosophers’ (T 1.3.9.19). He is usually taken to be referring here to indoctrination. I argue, however, that his main concern is with association and those philosophers who emphasize the epistemic dangers of the imagination. These include Locke, Hutcheson and Descartes, but not Hume himself. Hume praises education, highlighting its role in the formation of general rules, and in fostering social conditions that encourage the growth of knowledge and moral virtue.

Trade, Power, and Political Economy: Reason vs. Ideology in Edward Stringham’s Private Governance

RICHARD WAGNER

THE REVIEW OF AUSTRIAN ECONOMICS

Abstract: In Private Governance: Creating Order in Economic and Social Life, Edward Stringham explains that private ordering is sufficient to secure full exploitation of gains from trade within a society. After describing the logic of Stringham’s claim on behalf of private ordering, the remainder of this essay examines an enigma that Stringham’s argument entails: private ordering is sufficient for social coordination and yet public ordering is ubiquitous. The exploitation of gains from trade might offer a useful ideology, but this provides but an incomplete basis for a theory of society. In this respect, societies are rife with antagonism and envy, though these often manifest themselves ideologically as claims about justice and fairness. Politics goes where the money is; private ordering reveals targets that public ordering subsequently exploits. The challenge for political economy is to integrate the autonomy of economizing action with the autonomy of political action, for these dual autonomies provide the crucible out of which emerges the material of political economy. Stringham has deepened our appreciation of what private governance can accomplish, but much unfinished analytical work confronts theorists of political economy.

Private Governance and the three biases of political philosophy

JASON BRENNAN

THE REVIEW OF AUSTRIAN ECONOMICS

Abstract: Private Governance shows that philosophers, political and legal theorists, and social scientists mistakenly believe in legal centralism, the view that order in the world depends upon and is made possible by state law. In fact, most governance not only happens to be private, but must be private. This paper extends Edward Stringham’s argument by claiming that philosophers tend to suffer from three biases. Diffidence bias means they are overly pessimistic about people’s willingness and ability to cooperate without state enforcement. Statism bias means the overestimate the degree to which cooperation is secured by the state. Guarantee bias means they overestimate the value and need for legal guarantees.

Adam Smith, Prophet of Law and Economics

PAUL G. MAHONEY

THE JOURNAL OF LEGAL STUDIES, Volume 46, Number 1

Abstract: Law and economics scholars do not normally identify Adam Smith as an important figure in the field. However, his Lectures on Jurisprudence contain a wealth of insights and analytical techniques that law and economics scholars of the late 20th century would repeat. This paper argues for Smith’s place in law and economics, identifying some of his most important arguments and emphasizing their contributions to legal theory. It also argues that economic arguments play a central role in Smith’s theory of justice. Indeed, Smith’s jurisprudence provides an important bridge between his moral and economic theories.

Narrative Economics

ROBERT J. SHILLER

THE AMERICAN ECONOMIC REVIEW, Volume 107, Number 4

Abstract: This address considers the epidemiology of narratives relevant to economic fluctuations. The human brain has always been highly tuned toward narratives, whether factual or not, to justify ongoing actions, even such basic actions as spending and investing. Stories motivate and connect activities to deeply felt values and needs. Narratives “go viral” and spread far, even worldwide, with economic impact. The 1920–1921 Depression, the Great Depression of the 1930s, the so-called Great Recession of 2007–2009, and the contentious political-economic situation of today are considered as the results of the popular narratives of their respective times. Though these narratives are deeply human phenomena that are difficult to study in a scientific manner, quantitative analysis may help us gain a better understanding of these epidemics in the future.

The time inconsistency of long constitutions: Evidence from the world

GEORGE TSEBELIS

EUROPEAN JOURNAL OF POLITICAL RESEARCH

Abstract: This article analyses the mechanisms establishing time consistency of constitutions. It explains why shorter and more locked constitutions are more likely to be time consistent (change less) and that long constitutions are more time inconsistent (change more, despite locking). Empirical evidence from all of the democratic countries in the world indicates that the length and locking of constitutions are not independent criteria, and that their combination leads to less time consistency. To address this inter-relationship, a measure of time inconsistency (a combination of locking and amendment rate) is developed and it is demonstrated that it is connected with the length of constitutions. The article shows how time inconsistency is incompatible with theories of ‘constitutional amendment culture’ not only at the theoretical level, but also empirically. Finally, the article proves that the empirical finding that the length of constitutions is related to lower per capita income and higher corruption are not only in agreement with time inconsistency arguments, but this also extends beyond OECD countries to all democracies.