The Dominance of Norms

Law and Economics: Philosophic Issus and Fundamental Questions, Artistides N. Hatzis and Nicholas Mercuro, eds. Routledge, 2015

Vanderbilt Law and Economics Research Paper No. 16-23

44 Pages Posted: 21 Sep 2016

See all articles by Edward L. Rubin

Edward L. Rubin

Vanderbilt University - Law School; Vanderbilt University - Department of Political Science

Date Written: September 20, 2016

Abstract

The effort to take account of social norms represents the most sophisticated and productive response of microeconomic theorists to the attack on rational choice theory. Ultimately, however, it is an effort to repair the fairly obvious empirical defects of the theory rather than recognizing its real limitations. The basic limitation is that people respond to a wide and varied range of motivation beyond the desire to maximize their material self-interest. What makes rational choice theory seem plausible is that, in our society, material self-interest maximizing is one of people’s most powerful motivations. Thus, the theory has great explanatory value for us, but that is not because it is a human universal. It is because it is a central element of our culture, and occupies the same place for us that the desire for honor, for salvation or for some other value has occupied for previous societies. This can be illustrated by three examples from other societies: the urban elite’s withdrawal into rural villas in the Ancient Rome Empire, one of the main causes of the Empire’s decline, the reconstruction of Chartres Cathedral in the thirteenth century after a disastrous fire destroyed its Romanesque predecessor, and the nasty and brutish life of the Ik tribe in modern Uganda, as recounted by Colin Turnbull. In each case, people’s behaviors can be described in terms of rational theory, but the more plausible account is that they were motivated by essentially different considerations. The Roman elites were willing to leave the cities of the western Empire because the artificial character of these cities (in contrast to the Greek cities in the east) made them unable to secure the loyalty of their inhabitants. The citizens of Chartres were willing to devote effort and resources to rebuilding the Cathedral because of their intense religiosity and desire for salvation. The Ik suffer from a deep cultural malaise because their traditional lifestyle has been disrupted by modern political and economic developments. While material self-interest played some role in all these people’s behaviors, it was not their primary motivation. It is often the primary motivation of people in our society, not because it is central to human nature but because it is the result of a long process of cultural development, specific to the Western world and not fully developed until the eighteenth century, that included urbanization, commercialization, secularization, and the Protestant Reformation.

Keywords: Law and Economics, Social Norms, Rational Choice, Behavioral Economics, Culture, Society

Suggested Citation

Rubin, Edward L., The Dominance of Norms (September 20, 2016). Law and Economics: Philosophic Issus and Fundamental Questions, Artistides N. Hatzis and Nicholas Mercuro, eds. Routledge, 2015, Vanderbilt Law and Economics Research Paper No. 16-23, Available at SSRN: https://ssrn.com/abstract=2841289

Edward L. Rubin (Contact Author)

Vanderbilt University - Law School ( email )

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Vanderbilt University - Department of Political Science ( email )

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