Law, economic approach to

The development of an economic approach to legal practice has been the most important jurisprudential development in the last third of the twentieth century. Economic analysis has been offered as both a positive and a normative jurisprudence: as an analysis of important features of existing legal practices and as an ideal against which these practices ought to be evaluated. For some, economic analysis has a narrow explanatory range (in various fields of private law, corporations and taxation, and anti-trust law, for example), while others make broader claims for its ability to illuminate any area of law. Finally, there is a difference between those who focus on one explanation and those who focus on prediction, but all offer positive economic analysis of law based on the concept of economic efficiency as defined in welfare economics and applied to law by Coase, Posner, Calabresi and others.