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National Chiao-Tung University

Institute of Business and Management

Course ID

IBM 6055

Course Name

Economic Analysis of Law


Jin-Li Hu




1.          Cooter, R. and T. Ulen (2000), Law and Economics, 3rd ed., Massachusetts:  Addison-Wesley.

2.          Posner, R.A. (1992), Economic Analysis of Law, 4th ed., Boston: Little, Brown, and Company.

3.          Friedman, D. (2000), Law's Order, Princeton:  Princeton University Press.

Objective of the Course

This course analyzes the optimizing and strategic behavior under a legal system.  The optimal legal system design is also discussed.  Verbal and mathematical reasoning will both be introduced.

Course outlines

1.      Introduction to welfare economics

2.      Market failure

3.      Introduction to microeconomics and game theory

4.      Economic analysis of the property law (also on transaction cost)

5.      Economic analysis of the contract law (also on cooperative solution, non-cooperative solution, and Pareto improvement)

6.      Economic analysis of the tort law (also on risk and the optimal precaution)

7.      Economic analysis of the legal procedure (also on bargaining and  settlement)

8.      Economic analysis of crime and punishment (also on incentive mechanism design)

9.      Economic analysis of the competition law (also on market regulation)

Course requirements

Class attendance (30%), in-class discussion (30%), oral presentation (20%), term paper (20%)