International scholars gain new perspective at the Summer Institute in Law and Economics

The application of economics to the study and practice of law began in the early 1930s at the UChicago Law School, and since then it has become a central part of law curriculum as well as transformed the entire body of jurisprudence in the United States. Ben-Shahar said the program is part of the Law School’s effort to transform legal systems around the world, and push the frontiers of knowledge forward.

“In many countries, laws are enacted and are studied using strictly legal methodology, without asking questions about whether they are meeting their goals in any measurable way,” said Ben-Shahar, the Kearney Director of the Coase-Sandor Institute for Law and Economics. “Since laws aim to design the rules for society, it makes sense to use social science methods to evaluate their effect. It is quite astonishing that in many countries, including well-developed countries, law and economics as a methodology is not practiced in the mainstream.”

In China’s case, Ben-Shahar said the methodology would improve policymaking and contribute to a much more efficient market system, with sensible and effective regulations to prevent environmental degradation and achieve more equitable distribution of national income, and hence, more sustainable economic growth.

The summer program, inaugurated in July 2012, immediately attracted top legal scholars from mainland China, Hong Kong and Taiwan. Since then, as the program’s international visibility rose, applicants have poured in from Japan, South Korea, Thailand, Vietnam, Brazil, Chile, Colombia, France, Israel, Turkey and the United Arab Emirates.

This year, more than 70 international scholars from Asia (mostly mainland China), South America and Europe completed the courses in mid-July. The curriculum included law and property markets, taught by Lee Fennell; law and capital markets, taught by Douglas Baird; anti-trust laws, taught by Randal Picker; intellectual property, taught by Jonathan Masur and consumer contracts, taught by Ben-Shahar.

Richard L. Sandor, chairman and CEO of Environmental Financial Products LLC and lecturer at the Law School, delivered a keynote speech on how markets can help resolve the problems of emissions and climate change. Sandor’s financial support in the past has enabled the Coase-Sandor Institute to fulfill its mission of transforming legal systems around the world with the Chicago methodology and pushing the frontiers of knowledge forward. Martha Nussbaum, the Ernst Freund Distinguished Service Professor of Law and Ethics, presented an extracurricular lecture on “Human Development and the Capabilities Approach” that touched upon issues of social justice, which, according to participants, was an “explosive” issue confronting their countries.

Ruoying Chen, a Law School alumna and associate professor at Beijing University Law School, said the program would help China’s legal reforms and improve the rule of law there.

“The Chinese scholars who have gone through the program are mostly China’s elite and accomplished researchers and teachers in law, economics and political science at the country’s top institutions,” said Chen, who helped coordinate the program in China. “When you use a scientific method to research legal issues, you can increase efficiency in government regulations. Their learning here will enable them to make a difference in China’s transformation.”

Haitian Lu, who teaches law at the Hong Kong Polytechnic University, said the curriculum was “refreshing” because he “had never received this sort of systematic economic analysis of law.”

“Often times, we weren’t clear on why the law is written in a certain way,” said Lu, who specializes in legal development, corporate governance and corporate social responsibilities in Hong Kong and mainland China. “But this program allows us to understand the economic rationale behind these regulations, and what we can do to make these laws better and more efficient.” When he returns home, he plans to incorporate what he called “Chicago Thinking” into his teaching.

Zeynep Ayata, an assistant professor at Koç University in Istanbul, Turkey, and an expert on antitrust law, said economic analysis was a relatively new approach for her. “Now that I start to understand a lot of economic theories, I’ll be able to put law and economics together in my studies.”

Ayata said she has learned “a different method of teaching” from UChicago scholars. “The professors used some striking examples and gradually build on that,” she explained. “At the end of the four hours, you were able to understand the most sophisticated formula or analysis or graph that you could have in economic theory. The examples just stuck in your mind.”

Teaching as a Priority

Jie Qin, associate professor of law at China’s Southwest University of Political Science and Law, first came across a UChicago Summer Institute flier sent to her university in the fall of 2012. Since she had studied the legal works of several UChicago law scholars, she volunteered to translate the flyer into Chinese and posted it on her university website. As a result of her efforts, almost a dozen of her colleagues have participated since 2013. She came for the 2014 program because this year’s topic, “law and markets,” was relevant to her own research interests.

Qin was impressed with the “distinct teaching styles” of its faculty members.

“Some professors were truly refined and confident while others were passionate, humorous and inspiring,” she said.

Both Lu and Qin admired the priority that the Law School places on teaching. In mainland China and Hong Kong, they said professors often focus primarily on their own research and tend to neglect their teaching duties. “At UChicago Law School, professors who are top researchers in their fields make teaching or the dissemination of knowledge a priority. I think there is a lot we can learn from the faculty here,” said Qin.

New Perspectives

For Ayata, the various informal discussions after class enabled the participants to explore new ideas and gain new perspectives. “I’ve met a lot of legal scholars from different countries,” she said. “With the information you get from each other, you can look at what’s happening back at home with a different perspective.”

Ben-Shahar said it was helpful for him and his colleagues to interact with their counterparts from other parts of the world. “We gain a lot from this interaction, sharing our ideas and experiences with them and hearing about their work. We get to know what challenges legal scholars are facing in developing societies and what kind of reforms are being considered and enacted. In this way, we can engage in scholarship that contributes to the issues of a developing legal system.”

Besides seminars and after-class discussions, Joseph Burton, executive director of the Coase-Sandor Institute for Law and Economics, said organizers also hosted activities to introduce the international scholars to the city of Chicago and UChicago community.

“Participants took a campus and library tour, went swimming in Lake Michigan, had an American-style backyard barbecue, a banquet at the Quadrangle Club, attended the Taste of Chicago, toured the Art Institute, and biked down Lake Shore Drive for pizza at Gino’s East,” Burton said.

For Qin from China, the tours changed her perception of Chicago. “We sometimes read negative stories about the city and become wary of visiting,” she said. “But Chicago is truly a hospitable and beautiful city.”