Benson argues that public dissatisfaction with legal institutions is as prevalent as public disgust with many public institutions. That's hardly surprising. They are funded through taxes, run by bureaucracies, are famously inefficient, lack the capacity to calculate economically, and ignore the demands of consumers.
So is there another way? Yes, and here is where Benson shocks: he wants complete privatization. He says that private-sector institutions are capable of establishing strong incentives that lead to effective law making and law enforcement. The resulting legal constraints facilitate interaction and support social order by inducing cooperation and reducing violent confrontation.
The great merit of this Benson book is to prove these propositions a thousand times – using history, theory, and modern political analysis -- and to come up with the first full theoretical model for understanding them. In one way, his analysis is commendably plain: he is merely apply market logic to law. In another way, it is revolutionary because no one else in history has ever does so with more rigor and energy, so much so, in fact, that you will never think of the primary "duty" of the state in the same way.
Benson is DeVoe L. Moore Professor and Distinguished Research Professor in Florida State University's Department of Economics.
