Document Type

Article

Publication Date

2007

Publication Information

22 J. of Priv. Enterprise 37 (2007)

Abstract

Much of the contemporary discussion regarding law and public policy focuses on how government ought to address important issues. From global warming to technological innovation to corporate finance, voters and policy-makers alike share the belief that the tools of government ought to be brought to bear on all of the important matters of our times.

Virtually no attention is given public policy debates, however, to the question of whether government ought to address these important issues. In fact, the larger and more complex the issue, the more policy-makers and opinion leaders assume that government provides the only mechanism for addressing such concerns. Two types of "market failure," in particular, commonly serve as justifications for governmental intervention into and regulation of otherwise private markets and matters. Private market mechanisms are said to fail where society seeks the provision of what are commonly called "public goods," and also where the cooperation of large groups of individuals are necessary in order to accomplish some task. These latter problems, frequently termed "collective action" problems, can coincide with the problem of public goods provision, but can also arise independently of them.

These two typical justifications for imposition of regulation, the "Public Goods" justification and the "Collective Action" justification, have largely been embraced by neoclassical economists, and have been completely unchallenged by legal academics. Nevertheless, the question as to whether and to what extent private actors can regulate their own behavior without government coercion is an increasingly important one.

This Article attempts to answer this question by surveying the literature on private ordering and self-regulating human systems. As such, it demonstrates the many circumstances under which human beings have provided law and order to govern their affairs without the monopolized use of coercive physical force or violence characteristic of, and indeed defining, governmental regulation.

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