Book Reviews

• Author: Peter C. Carstensen
• DOI: 10.1177/0003603X7401900412
• Published date: 01 December 1974
• Date: 01 December 1974
• Subject Matter: Book Reviews

BOOK

REVIEWS

Richard A. Posner, Economic A.nalysis

of

Law, Boston

and

Toronto:

Little, Brown

and

Co. (1973), 395 pp., $9.50.

Professor

Posner's

Economic A.nalysis of Law is

the

kind

of book which can give economics a

bad

name in non-economic

circles. This volume is intended

primarily

as a

text

for

use

in a course on "economic analysis of law,"

or

as a supplement

for

law students interested in understanding more about

the

relationship between economics

and

legal analysis. These

are

very

laudable ambitions,

and

there is a

real

need

for

a book

or

books which

apply

economic analysis

to

legal issues as

well as legal analysis to economic issues. Posner's economics

is a blend of traditional "micro" theory revolving

around

the

achievement

and

maintenance of optimality with useful in-

sights

into

the

way

in which transaction costs affect the eco-

nomic process,

but

the model used is

rigid

without being

rigorous.

Its

assumptions lack specificity; the resulting con-

clusions have no clear limits of application. While suggest-

ing

that

there

are

"limitations" to economic analysis

"as

both

an interpretive

and

anormative tool,"

Posner

concededly

has

"not

emphasized these limitations in the

text

. .

..

"1

Because no basis is offered

for

a

student

to

develop a

rational

sense of those limits, this approach does

not

create the frame-

work in which a law student can acquire an understanding of

economic analysis which assists legal analysis,

nor

does

it

facilitate an appreciation of the range of interaction between

legal 'and economic models. Thus, while the book does offer

many

illuminating comments

and

isolated analyses,

there

are

problems with the overall effectiveness of the effort.

I.

Chapter

1presents

Posner's

economic model which

rests

on the assumption

that

"man

is a

rational

maximizer of his

ends in life."

1.1

From

this

premise he derives

three

familiar

economic concepts:

the

relationship of supply

and

demand

1R. Posner, Economic Analysis of Law [hereinafter, Analysis}.

1.1

Analysis, 1.

867