1744 IOWA LAW REVIEW [Vol. 100:1743
The 2014 Levitt Lecture covered the relationship between natural law
and social welfare theory over a period that extends to close to 2000 years. In
some sense, this subject presents the intellectual challenge of explaining how
ideas that have gained currency only in the last 150 or so years relate to legal
approaches that were developed well over a thousand years earlier, when, in
total ignorance of modern economic tools, it was impossible conceptually just
to ask the question of how the determination of legal rules systematically
related to any understanding of overall social welfare.
In this Essay, I hope to trace out the complex interconnections in three
stages. The first part examines the approach to the natural law within the
Roman and early common law traditions. The second portion examines the
classical synthesis of these issues from mid-17th century to the late 19th
century. The last section then makes explicit the transition from natural law
to social welfare theory from the late 19th century to the present. In so doing,
I shall address three measures of social welfare, the Pareto principle, the
Kaldor–Hicks principle, and a third standard, often left unappreciated, that
prorates the gains from any positive sum venture among the relevant parties.
A brief conclusion follows.
II. THE NATURAL LAW TRADITION
There was, even within the natural law tradition, the sense that legal rules
were designed to deal with self-preservation (if you are a pessimist about the
world) or human flourishing (if you take a more optimistic view of your
subject matter). But as a determined student and teacher of Roman law from
my first day at law school in Oxford in the fall of 1964, it became clear that
the expression “ratio naturalis” or natural reason concealed more than it
revealed. The term was invoked at key points in the articulation of the
fundamental rules of the legal system. It was thought that slavery was contrary
to the law of nature,1 (even in the face of the brute reality of slavery), and that
children born of freed slaves must also be free.
2 Natural reason allowed
people to capture and use things that were unowned in the state of nature,3
and to transfer their property to others by some form of delivery either formal
or informal,4 and to form partnerships.5 Natural law allows us to keep
buildings erected on our land by others,6 to impose guardianships on children
1. J. INST. 1.2.2 (J.B. Moyle trans., 1911).
2. G. INST. 1.89 (Edward Poste trans., 1904).
3. Id. at 2.66.
4. Id. at 2.67.
5. Id. at 3.154.
6. Id. at 2.73.