Legal Control Over the Supply of Handguns: An Analysis of the Issues, with Particular Attention to the Law and Economics of the Hamilton V. Beretta Suit Against Handgun Manufacturers

Abstract

One of the most influential schools of thought in evaluating the legal process is law and economics. Although this discipline has been in existence for over thirty years, no one has attempted to evaluate whether, and to what extent, it affects the court's decision in a case. The issues we consider in this paper are how economic testimony affected the decision in an actual case and the role afforded by the court to economic analysis as contrasted with the law in crafting a decision. This presentation also provides readers with a review of the issues and evidence on the important public policy issue of handgun control. Our methodology was to examine the trial and appeal of Hamilton v. Beretta from both a legal and an economic perspective.

Handguns (and cigarettes) are perhaps the most controversial of all products sold in the United States. Between 1962 and 1994, 667,000 of the more than 1,000,000 firearm-related deaths involved handguns. Handguns are identified as having been used in an overwhelming number of crimes. The debate surrounding the Second Amendment is considered.

An issue we analyzed in the paper was whether the gun manufacturer's economic argument had an impact on the court's decision. A study by the Department of Justice, resting on 648 ATF illegal gun trafficking investigations, involving youth ages 18-24 and juveniles ages 17 and under, revealed that 78% of the investigations involved new guns, while 55% involved used guns. This suggests that, at least in regard to the ATF investigations, new guns were fairly-often used in crimes. This implies that requiring gun manufacturers to exercise care in marketing may indeed have a meaningful impact upon the violence generated by new guns.

Keywords: guns, handguns, Second Amendment, gun control, homicide, crime, economics, Constitution, negligence, nuisance, cause in fact, proximate cause, remote, deterrence, supply, demand, Hamilton v. Beretta, tort suit, civil suit