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Spontaneous order & law

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Thursday, Dec. 14, 2006
 

Adam Smith famously observed that "it is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest." Smith explained how self-interested behavior by each person in a private-property-rights environment combines with the self-interested actions of others to bring about a peaceful, productive and complex economy that no one designed. This economy is the result of what Smith called "the invisible hand."

Can decentralized, self-interested actions also produce law• The answer is "yes."

This holiday season as you drive around in shopping-mall parking lots looking for a place to park, notice what happens if you spot a car pulling out of a parking space. If no other driver sees that space, you pull up close to it, leaving the exiting driver enough room to pull out and drive away. You probably also turn on your car's turn signal. Your actions inform other drivers who might come by that you claim the parking space.

And when other drivers do come by -- drivers just as desperate for a parking space as you are -- and they see your car idling just behind the soon-to-be-cleared space, they drive on by. Each one of these drivers is disappointed to have missed the opportunity to park in that space, but none of them tries to dash into it ahead of you.

What exists here is a system of property rights. Without anyone inscribing rules into a statute book, and even without anyone intending to create such property rights, everyday human interactions in parking lots have established the practice that the first who notices a parking space about to be cleared can claim that space as his own by idling his car close by the space. The first driver to see any such space and to idle his car beside it expects that his claim on that space will be honored -- and this expectation typically is valid.

Our simple, familiar actions in crowded parking lots are an example of spontaneous law. Such laws emerge unplanned, yet because they are widely obeyed they help to minimize frictions among us.

Some people will object to applying a label as lofty as "law" to something so workaday as being polite in parking lots. But this label is appropriate. Fair and just laws are those that give each of us great room to pursue our own goals while at the same time they keep us as much as possible from interfering with each other.

Some such laws are especially important -- such as laws against murder and rape -- and these very important laws obviously warrant more resources and effort put into their enforcement. Nevertheless, because following the established practice of claiming a parking space also helps to keep us out of each other's hair, this established practice is law.

Some will object that "law" is only that which is consciously designed and formally promulgated, such as statutes. But a moment's reflection shows this claim to be untrue.

Many rules written down by government officials are not really the law. Be honest: Have you ever intentionally driven 60 mph when the speed limit was 55 mph• If so, you knowingly violated the clear-as-crystal posted "law" that prohibits driving faster than 55 mph.

In fact, though, the real law is different. The real law says that you can drive 5 or 10 mph above the posted speed limit if traffic and road conditions permit. This real law isn't written down anywhere but it's the one that most drivers (and highway patrol officers) know and follow.

Likewise, in some states consensual sex among unmarried adults remains on the statute books as a criminal offense. But do adult unmarried couples who sleep with each other in these states really break the law• Would any jury convict as criminals any such couple charged with having consensual sex out of wedlock?

More interestingly, starting about 1,000 years ago when trade in the Mediterranean began to escalate, the practices of merchants spread throughout dozens of countries and city-states and grew in to commercial law. These merchants were not beholden to a single sovereign power. So if, say, a merchant in Venice had a commercial dispute with a merchant in Tunisia, no single government was available to settle the dispute and to enforce the judgment.

No matter: These merchants formed their own courts. The common practices of merchants became "merchant law." The decisions of these courts were obeyed because no merchant wanted a reputation for being uncooperative with the merchant courts. And the law that was spelled out in these courts over the years was eventually recorded. Today it forms the core of the Uniform Commercial Code used in the United States.

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