Polycentric Law

Description

1.

"Polycentric law is a structure of overlapping or competing legal systems. Instead of having a single, monopoly provider of law and legal services, different systems are used to resolve disputes alongside one another.

‘Polycentricity’ (a term first introduced by philosopher and scientist Michael Polanyi) is simpler than it may sound. It means simply ‘many’ (poly) ‘centers’, in this case, centers of law."

2. From the Wikipedia [1]:

"Polycentric law is a legal structure in which providers of legal systems compete or overlap in a given jurisdiction, as opposed to monopolistic statutory law according to which there is a sole provider of law for each jurisdiction. Devolution of this monopoly occurs by the principle of jurisprudence in which they rule according to higher law.

Tom W. Bell, former director of telecommunications and technology studies at Cato Institute, now a professor of law at Chapman University School of Law in California[2] wrote "Polycentric Law," published by the Institute for Humane Studies, when he was a law student at the University of Chicago. In it he notes that others use phrases such as "privately produced law," "purely private law," and "non-monopolistic law" to describe these polycentric alternatives. He outlines traditional customary law (also known as consuetudinary law) before the creation of states, including as described by Friedrich A. Hayek, Bruce L. Benson, and David D. Friedman. He mentions Anglo-Saxon customary law, church law, guild law, and merchant law as examples of polycentric law. He notes that customary and statutory law have co-existed through history, as when Roman law applied to Romans throughout the Roman Empire, but indigenous legal systems were permitted for non-Romans. In "Polycentric Law in the New Millennium," which won first place in the Mont Pelerin Society's 1998 Friedrich A. Hayek Fellowship competition, Bell predicts three areas where polycentric law might develop: alternative dispute resolution, private communities, and the Internet.

The University of Helsinki (Finland) funded a "Polycentric Law" research project from 1992 to 1995, led by professor Lars D. Eriksson. Its goal was to demonstrate "the inadequacy of current legal paradigms by mapping the indeterminacies of both the modern law and the modern legal theory. It also addressed the possibility of legal and ethical alternativies to the modern legal theories" and "provided openings to polycentric legal theories both by deconstructing the idea of unity in law and re-constructing legal and ethical differences." The project hosted two international conferences. In 1998 the book Polycentricity: The Multiple Scenes of Law, edited by Ari Hirvonen, collected essays written by scholars involved with the project.

Professor Randy Barnett, who originally wrote about "non-monopolistic" law, later used the phrase "polycentric legal order." He explains the advantages of such a system in his book The Structure of Liberty: Justice and the Rule of Law.

Bruce L. Benson also uses the phrase, writing in a Cato Institute publication in 2007: "A customary system of polycentric law would appear to be much more likely to generate efficient sized jurisdictions for the various communities involved — perhaps many smaller than most nations, with others encompassing many of today’s political jurisdictions (e.g., as international commercial law does today)."

John K. Palchak and Stanley T. Leung in "No State Required? A Critical Review of the Polycentric Legal Order," criticize the concept of polycentric law.

Legal scholar Gary Chartier in "Anarchy and Legal Order" elaborates and defends the idea of law without the state. [8] Animated by a vision of peaceful, voluntary cooperation as a social ideal and building on a careful account of non-aggression, the book seeks to explain why the state is illegitimate, dangerous, and unnecessary. It proposes an understanding of how law enforcement in a stateless society could be legitimate and what the optimal substance of law without the state might be, suggests ways in which a stateless legal order could foster the growth of a culture of freedom, and situates the project it elaborates in relation to leftist, anti-capitalist, and socialist traditions." (http://en.wikipedia.org/wiki/Polycentric_law)

Discussion

"How can a person use a different legal system from the same location, while their neighbors use something else? When do we stand in the ‘law’ aisle or on the ‘law dealership’ lot and choose the best law for our business or community?

First, many transactions we make need not be ‘tied’ to the location where we live. For example, businesses which trade overseas often will specify in their contracts which legal system they will use in the event of a disagreement. Both parties agree, for example, to have their disputes resolved in a US or British court, or even by a private arbitrator who they both respect and believe is fair.

This can occur even if neither party lives in the country or near the arbitrator that they’re using. International politics is ‘polycentric’ (though almost certainly still too monopolistic), and businesses are choosing legal systems from different national sets.

However, many laws are not just about trade and it is much more difficult to see how criminal or other laws can be ‘contracted’ like in our example.

This leads us to the importance of ‘switching costs’. Since we all live in some kind of community, with some kind of neighbors, somewhere, then a polycentric system is best achieved by allowing for a wide variety of different areas with different legal systems. The benefits of polycentricity require that we maintain a system of competition and choice – otherwise it begins to no longer resemble a system of ‘many centers’.

This means that we need to maintain ‘low switching costs’ for polycentric law to operate well. Walking from one car to another in the lot is a low cost way of finding good alternatives. We need to approximate this process as well as we can at the legal system level.

Consider a simple example. Cities like New York and Boston have different rules and compete with one another for residents. In the case of these cities, the rules are not especially distinct and U.S. federal law constrains the variety of laws and innovation between these two cities.

Since the difference between these legal systems is small, few people are willing to make the move from Boston to New York or vice-versa to find a better system. The costs of switching simply aren’t worth the little reward." (http://www.radicalsocialentreps.org/theory/polycentric-law/)

Radical Enterpreneurs against monopoly law?

"At the level of law-creation itself, many monopoly legal systems are structured to favor existing businesses and political elites. For instance, an established firm may lobby to have their particular mode of production written into law. This makes sure that upstarts – likely to innovate the process or pursue a rival model – are unable to get off the ground.

Monopoly law becomes a weapon for monopoly firms.

Stagnant, monopoly law has another serious effect: corruption. Corruption grows as the poor are unable to easily use the legal system, and as the rules become structured to benefit elites. People who cannot afford to go to court are more willing to pay bribes to avoid charges. The system rewards unscrupulous enforcers, who can take money to ‘look the other way.’

As legal rules grow more complicated and specific, people begin to accidentally break the law in their day-to-day lives. For instance, minute regulations for the display of trading licenses – that it must not be covered by a winter jacket, for example – lead to conflict between the world’s poor and law enforcement.

Fines for breaking these rules, which sometimes seem arbitrary and not protecting anyone, lead to resentment, violence, and extortion. Those targeted are often those who have the least ability to seek a redress of grievances in court.

Just as we want ‘many centers’ of social entrepreneurship, we need ‘many centers’ of legal activity. These centers won’t build themselves. To erode monopoly power with start-ups in business we need upstarts in law, channeling their ingenuity to building our polycentric system. In the process RSEs working for legal innovation can help fight corruption, empower the world’s poor, and spur economic progress." ((http://www.radicalsocialentreps.org/theory/polycentric-law/))