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72 Fla. L. Rev. 1211 (2020)


Externalities caused by religious exemptions have been getting the spotlight again in light a case the U.S. Supreme Court will hear this term: Fulton v. City of Philadelphia. Some argue that religious individuals should be required to internalize the costs they impose on third parties and thus should be denied the right to practice that harmful behavior. These new progressive theories about harm trade on rhetoric and normative intuitions regarding externalities and costs. But curiously, these theories also largely ignore an influential theoretical movement that has studied externalities and costs for the last fifty years: law and economics.

This Article thus poses a thought experiment: how would normative rhetoric and doctrinal assessments change if one viewed religious externalities through the lens of economic theory? Such a perspective offers three novel normative insights. First, the mere existence of a religiously caused externality does not provide a sufficient justification for government restriction of religious rights, as because externalities are always reciprocal. Second, the government should be cautious about coercing involuntary transactions where idiosyncratic valuation or high transaction costs are involved. And third, exploring outcomes that decrease net harm can highlight government policies that are themselves creating harm. In other contexts, this analysis can force decision-makers to confront more candidly problems of incommensurability, particularly when it comes to dueling claims of dignitary harms.

An economic lens can also provide a positivist account of multiple aspects of a religious exemption doctrinal framework in the context of strict scrutiny. These include balancing competing harms in recognition of reciprocal externalities, requiring the government to have a justification for coercing involuntary transactions in a similar way that property rules would, and assessing carefully whether alternatives exist to avoid harm altogether. Indeed, this latter inquiry closely resembles the type of analysis courts engage in under the “less restrictive alternatives” element of the strict scrutiny analysis.

While economic theory does not provide answers to all of the difficult questions in these religious exemption debates, it can provide a clinical method of analyzing hot-button issues involving seemingly intractable conflicts. And to the extent that harm is a relevant normative consideration, this Article asserts that an under-theorized reliance on harm on just one side of the ledger, advocated under the current third-party harm theories, is a normatively unpersuasive approach.



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