'LAW AND ECONOMICS' (RICHARD POSNER, GUIDO CALABRESI, RONALD COASE):

Question

Accepted Answer

B.

1. LAW AND ECONOMICS (L&E) applies neoclassical economic analysis to legal rules and institutions.
2. ORIGINS: Chicago School and Yale.
3. KEY THINKERS:
4. (i) Ronald COASE — 'The Problem of Social Cost' (1960); COASE THEOREM: with zero transaction costs, parties bargain to efficient outcome regardless of initial entitlement;
5. (ii) Guido CALABRESI — 'The Costs of Accidents' (1970) and 'Tragic Choices' (1978);
6. (iii) Richard POSNER — 'Economic Analysis of Law' (1973, 9 editions);
7. (iv) Gary BECKER — economics of crime;
8. (v) Coase's prize: Nobel Economics 1991.
9. CORE METHODS: EFFICIENCY analysis (Kaldor-Hicks); TRANSACTION COSTS; RATIONAL CHOICE; MARKETS as benchmark.
10. APPLIED TO: contract law (efficient breach); tort law (Hand formula B<PL); property law (rights as bundles of incentives); criminal law (cost-benefit punishment).
11. CRITICS: distributional consequences ignored; assumes rational actors (challenged by behavioural law and economics).
12. INDIA: still emerging field; NLSIU offers L&E courses.
13. Hence option B is correct.
_Source: Legal Research Methodology + Jurisprudence — Richard Posner, 'Economic Analysis of Law' (1973); Guido Calabresi, 'The Costs of Accidents' (1970); Ronald Coase, 'The Problem of Social Cost' (1960)_