A Comprehensive Analysis of Interaction between Law and Economics
12 Pages Posted: 8 Aug 2014
Date Written: August 6, 2014
Business law deals with the creation of new businesses and the issues that arise as existing businesses interact with the public, other companies, and the government. This area of the law draws on a variety of legal disciplines, including tax law, intellectual property, real estate, sales, employment law, bankruptcy, and others. This paper seeks to explore the relationship between law and economics. The paper covers various theories that relates to economics and law. By understanding the role of business law within the legal system, it helps to view businesses as entities separate from their owners and employees. An enforceable system of business laws also benefits the economy as a whole and provides for more efficient transactions.
Keywords: Law, Economics, Contracts, Pareto Efficiency, Rational Theory, Litigation, Property Rights, Insolvency, Void Contracts, Limited Liability, Penalties, Pareto, Coase Theorem, Kaldor-Hicks Efficiency.
JEL Classification: A10, A12, D23, D63, D74, F13, J41, J52, K00, K11, K12
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