When Courts Compete for ‘Business,’ Liberty Wins

Those who insist that market anarchism cannot work because it lacks a monopolistic court of final jurisdiction are wrong.

Considering that what liberty we continue to enjoy in the West is a product in large part of competing legal institutions operating within overlapping jurisdictions hundreds of years ago, it’s curious that so many libertarians still believe such an order—an essential feature of free-market, or natural-law, anarchism—would be inimical to liberty. Why wouldn’t that which produced liberty be up to preserving it?


When I say that competition produced liberty, I of course do not mean that liberty was anyone’s objective. Yet liberty emerged all the same, as if by an “invisible hand.” That’s how things often work. Good (and bad) consequences can be the result of human action but not of human design (to use a favorite phrase of F. A. Hayek’s, which he borrowed from the Scottish Enlightenment thinker Adam Ferguson).

当我说竞争产生自由时,我当然并不是说自由是谁人的目标。然而自由还是一样产生了,就像一只“看不见的手”创造出来的一样。这就是很多情况下事物的运作方式。好的(和坏的)后果可能是人类行为而不是人类设计的结果(这是哈耶克从著名苏格兰启蒙主义思想家Adam Ferguson那里借用的口头禅)。

We should be delighted to know that something so wonderful as liberty can emerge unintentionally. It should give us hope for the future; if the libertarian movement is deficient, we need not assume that liberty has no chance. (I have more to say about liberty as an unintended consequence in the context of Magna Carta here.)


Many authors from the 18th century onward have written about the unintended good consequences of competition, i.e., the absence of central control. They emphasized that in the West the rivalries between church and state, between nobles or parliament and crown, and between nation-states yielded zones of liberty that endure to this day, however diminished in particular matters.


Competition among legal institutions—courts and bodies of law—within overlapping jurisdictions played a large role in this centuries-long beneficent process. These of course are not examples of anarchism; on the contrary, states existed. But competitive overlapping legal regimes are an element of market anarchism.


So where a state coexisted with a polycentric legal order, we may say, with Bryan Caplan, that there existed “less than the minimum” state, that is, something that fell short of the nightwatchman state favored by limited-government libertarians.

所以当一个国家存在一种多中心的法律秩序时,我们可以用Bryan Caplan的话来说,这里就存在着一种“比最小国家更弱一点”的国家,也就是说,比喜欢有限政府的自由意志主义者所期待的守夜人政府更弱一点的东西。

A good place to read about competition in law and dispute resolution is Todd J. Zywicki’s highly accessible Northwestern University Law Review article “The Rise and Fall of Efficiency in the Common Law: A Supply-Side Analysis.”

Todd J.Zywicki发表在Northwestern University Law Reviews上的文章“普通法中的效率兴衰史:一种供给侧分析”是一篇了解法律和争端解决机制中的竞争情形的深入浅出的文章。

An important feature that “influenced the common law’s evolution,” Zywicki writes, “was the competitive, or ‘polycentric,’ legal order in which the common law developed. During the era that the common law developed, there were multiple English courts with overlapping jurisdictions over most of the issues that comprise the common law. As a result, parties potentially could bring a particular lawsuit in a variety of different courts. In turn this created competition among these various courts for business.”


The idea of courts competing for “business” sounds strange to modern ears, but it was commonplace before the 20th century. (The extent of private arbitration in international commerce is largely unappreciated.)


Zywicki’s paper shows that the common law, which featured this competition, was efficient in the eyes of those who used its services. Monopoly is inefficient even (especially?) in matters of security, dispute resolution, and justice. Moreover, it’s a mistake, as Hayek explains in Law, Legislation, and Liberty (volume 1) to assume that government is the source of law.


Moves away from competition and the common law, then, aren’t adequately explained by shortcomings in its services to its consumers. Political ambition provides a more satisfactory explanation. (In the case of the criminal law, see this.)


Zywicki draws on the legal historian Harold Berman, who wrote, “Perhaps the most distinctive characteristic of the Western legal tradition is the coexistence and competition within the same community of diverse jurisdictions and diverse legal systems.”

Zywicki引用了法律史学家Harold Berman的话:“也许西方法律传统的最与众不同之处在于多样化的司法管辖权和多种法律体系在同一个共同体内部共存和竞争。”

The legal philosopher Lon L. Fuller went further: “A possible objection to the view [of law] taken here is that it permits the existence of more than one legal system governing the same population. The answer is, of course, that such multiple systems do exist and have in history been more common than unitary systems.” (Emphasis added.)

法哲学家Lon L.Fuller进一步指出:“对这种(法律)概念的一个可能的反对意见是,它允许多个司法体系管辖同一个人群。当然,对此的回答是:这样的重合体系确实存在,并且在历史上比一元化的(司法)体系更为常见”。

The limited-government libertarian who insists that market anarchism cannot work because it lacks a monopolistic court of final jurisiction is like the apocryphal aerodynamicist who calculated that a bumblebee couldn’t possibly fly. One needed only to point out the window, saying, “Behold!” Likewise, the anarchist need only point to history.


Berman also wrote (quoted by Zywicki), “The same person might be subject to the ecclesiastical courts in one type of case, the king’s courts in another, his lord’s courts in a third, the manorial court in a fourth, a town court in a fifth, [and] a merchants’ court in a sixth.” This sounds as though the courts were not really competitive, but rather that the variety of courts constituted specialization and a division of labor.


But that inference would be wrong. To see this we may turn to a keen contemporaneous observer, Adam Smith. In The Wealth of Nations Smith notes that despite a de jure division of labor, courts in fact competed with one another, even to the point of entrepreneurially finding ways to lure cases from other courts.


Why do this? Because the courts obtained their revenues from fees paid by parties to cases. The more cases a court heard, the more money it earned, a state of affairs that Smith, no anarchist of course, approved of: “Public services are never better performed than when their reward comes only in consequence of their being performed, and is proportioned to the diligence employed in performing them.”


Smith described the legal environment of his day:


The fees of court seem originally to have been the principal support of the different courts of justice in England. Each court endeavoured to draw to itself as much business as it could, and was, upon that account, willing to take cognisance of many suits which were not originally intended to fall under its jurisdiction.


The court of king’s bench, instituted for the trial of criminal causes only, took cognisance of civil suits; the plaintiff pretending that the defendant, in not doing him justice, had been guilty of some trespass or misdemeanour. The court of exchequer, instituted for the levying of the king’s revenue, and for enforcing the payment of such debts only as were due to the king, took cognisance of all other contract debts; the plaintiff alleging that he could not pay the king because the defendant would not pay him.


In consequence of such fictions it came, in many cases, to depend altogether upon the parties before what court they would choose to have their cause tried; and each court endeavoured, by superior dispatch and impartiality, to draw to itself as many causes as it could.


The present admirable constitution of the courts of justice in England was, perhaps, originally in a great measure formed by this emulation which anciently took place between their respective judges; each judge endeavouring to give, in his own court, the speediest and most effectual remedy which the law would admit for every sort of injustice. [Emphasis added.]


Zywicki also quotes from Smith’s Lectures on Jurisprudence:


Another thing which tended to support the liberty of the people and render the proceedings in the courts very exact, was the rivalship which arose betwixt them.


It may be argued that the state provided a backdrop to the competitive legal order, such that a forum of last resort was always available. This argument loses its force, however, when one realizes, as Edward Stringham teaches, that private dispute-resolution procedures arose in matters where states abstained from involvement, such as the nascent stock markets. (For more on the weakness of the “shadow of the State” argument, see this.)

有人可能会认为,竞争性的法律秩序总有国家站在后面,因此终极的裁决平台总是存在。然而,就如Edward Stringham教导的那样:当国家放弃参与时,私人的纠纷解决程序才会出现,就像最初的股票市场那样。只要意识到这一点,上述论调就变得苍白无力。(关于“国家的影子”论调的弱点,详见这里)。

“In short,” Zywicki sums up, “a market for law prevailed, with numerous court systems competing for market share in order to increase their fees. This competitive process generated rules that satisfied the demand of consumers (here litigants) for fairness, consistency, and reasonableness.”


Bumblebees fly and reasonably pro-freedom dispute resolution emerges without the state, no matter what a cloistered theoretician may think.


翻译:Luis Rightcon(@Rightcon)


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