Economic analysis is one of the major theoretical approaches to the study of law. It focuses on how legal rules affect (a) the behavior of individuals and firms, (b) the allocation of risk, and (c) the distribution of resources in society. This introductory course covers the basic concepts of law and economics, including the Coase Theorem, the difference between property rules and liability rules, the allocative effects of alternative tort rules (e.g., strict liability vs negligence), the design of efficient contract damages, the role of insurance, as well as the economics of criminal law. Students will develop the ability to apply economic principles to legal questions in many areas of law, both to predict the effects of alternative legal rules and to identify what rules would be "optimal" in particular contexts. Students will also develop the ability to offer forceful critiques of economic arguments as applied to the law, to identify the underlying assumptions and spot flaws in the reasoning. No prior knowledge of economics is assumed.
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