Institutional Law and Economics: The Legal-Economic Nexus

There are both similarities and differences in the view of James Buchanan and Warren Samuels/Al Schmid on the issue of how economists should act in the policy and public choice arena. James Buchanan Buchanan defines the science of political economy as, "its purpose is to evaluate the structure of the constraints, the law, with some ultimate objective of redesign or reform aimed at sec using enhanced efficiency in the exploration of potentially mutuality of advantage". In 1964, James Buchanan wrote "What Should economists do" in the Southern Economic Journal.  He wrote that, "man's behavior in the market relationship, these are the proper subject for the economists study" (pg. 214, 1964, SEJ).  He was very clear that economists should study the market relationship and not resource allocation.  The reason for this distinction is Buchanan does not want to privilege the idea of "society" over the "individual".  He goes on to cri