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Law, Liberty and Economic Growth

Notes

1 Discussions in greater detail of these systems of law may be found in Rene David, Traite Élémentaire de Droit Civil Compare (Paris: Librairie Générale de Droit et de Jurisprudence, 1950); Friedrich A. Hayek, Law, Legislation and Liberty, 3 Vols. (Chicago: University of Chicago Press, 1973); Bruno Leoni, Freedom and the Law (Princeton, NJ: D. Van Nostrand, 1961); T.F.T. Plucknett, A Concise History of the Common Law, 5th ed. (London: Butterworth, 1956); J.H. Merryiman and David S. Clark, Comparative Law: Western and Latin American Legal Systems(Indianapolis, IN: Bobbs Merrell, 1978); Owen H. Phillips, A First Book of English Law, 6th ed. (London: Sweet and Maxwell, 1970); John H. Merryman, The Civil Law Tradition (Stanford, CA: Stanford University Press, 1985); N.P. Aghnides, Mohammedan Theories of Finance (Lahore, Pakistan: Premier Book House, 1961); M. Asad, The Principles of State and Government in Islam (Berkeley, CA: University of California Press, 1961); William E. Butler, Soviet Law (London: Butterworth, 1983); and G. Ripert, Le Décline du Droit (Paris: Librairie Générale de Droit et de Jurisprudence, 1949).back

2 There is no better definition of rule of law than that given by the eminent legal scholar A. V. Dicey. He writes that the concept of the rule of law has three meanings. (1)...."that no man is punishable...except for a distinct breach of law established in the ordinary legal manner before the ordinary Courts of the land. In this sense the rule of law is contrasted with every system of government based on the exercise by persons in authority of wide, arbitrary or discretionary power of constraint." (2) "....when we speak of the ‘rule of law’ as a characteristic of our country, not only that with us no man is above the law, but (what is a different thing) that here every man, whatever be his rank or condition, is subject to the ordinary law of the realm and amenable to the jurisdiction of the ordinary tribunals." (3) "We may say that the constitution is pervaded by the rule of law on the ground that the general principles of the constitution (as for example the right to personal liberty, or the right of public meeting) are with us the result of judicial decisions determining the rights of private persons in particular cases brought before the Courts; whereas under many foreign constitutions the security (such as it is) given to the rights of individuals results, or appears to result, from the general principles of the constitution." A.V. Dicey, Introduction to the Study of the Law of the Constitution. Reprint. Originally published: 8th ed. London: Macmillan, 1915, pp. 110, 114-15.back

3 Gerald W. Scully, "The Institutional Framework and Economic Development," Journal of Political Economy, 96, June 1988, pp. 652-62; K.B. Grier and G. Tallock, "An Empirical Analysis of Cross-National Economic Growth, 1951-80," Journal of Monetary Economics, 24(2), Sept. 1989, pp. 259-76.back

4 I take the historical choice of the type of legal system as a given, since some legal systems were imposed on the population (for religious reasons under Islamic law and political reasons in the codified and Marxist-Leninist traditions) and change is almost impossible. Where change is theoretically possible, as in representative government, the evolutionary character of common law and the continuous drafting of parliamentary statutes in both common- and civil-law nations may yield continued political acceptance of a system of law chosen centuries before. In Europe’s former colonies, precolonial legal traditions are modifying the colonial legal tradition, most importantly in Islamic countries.back

5 Concerning the implications for freedom of the radically different sources of law in these legal traditions, Friedrich A. von Hayek in Law, Legislation and Liberty notes that:

The freedom of the British which in the 18th century the rest of Europe came so much to admire was thus not, as the British themselves were among the first to believe and as Montesquieu later taught the world, originally the product of the separation of powers between legislature and executive, but rather a result of the fact that the law that governed the decisions of the courts was the common law, a law existing independently of anyone’s will and at the same time binding upon and developed by the independent courts; a law with which parliament only rarely interfered with and, when it did, mainly only to clear up doubtful points within a given body of law. One might even say that a sort of separation of powers had grown up on England, not because the "legislature" alone made law, but because it did not; because the law was determined by courts independent of the power which organized and directed government, the power namely of what was misleadingly called "the legislature."back

6 Eastern water rights are riparian. Under a riparian system the state owns the surface water and citizens may use as much as they like on a first come, first served basis.back

7 Most recently, northern Nevada water rights were confiscated by the state legislature to increase the Las Vegas water supply.back

8 The Muslim religion is divided into two sects: Sunni and Shiite. The Shiites arose as a sect in a dispute over who was the rightful successor of the Prophet.back

9 Scully, "The Institutional Frame work and Economic Development," and Tallock, "An Empirical Analysis of Cross-National Economic Growth, 1951-80."back

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 tes cannot be overturned by judicial review."