Institutions

This chapter discusses the legal institutions charged with assigning responsibility. These consist primarily of tort law for accidental harms, and criminal law for intentional harms. Secular law most likely evolved out of moral precepts that predated the existence of the state, and which acted to promote socially desirable behavior. An economic perspective on law is that it “prices” harmful behavior, thereby curbing it to an acceptable level. A consequence of this perspective is that the distinction between accidental and intentional harm is not important. This will be a theme throughout the book. This chapter also discusses the divergence between the ideal and the actual functioning of the law. Specific problems considered are the costs of detecting those who cause harm, particularly when it was done intentionally, and the credibility of threats to impose punishment when an offender is caught. Finally, the costs of proving legal responsibility as a pre-requisite to imposing punishment are discussed.