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3 Bimonthly Rev. L. Books 1 (1992)

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BIMONTHLY REVIEW                                OF LAW              BOOKS

                                                 Volume   3 Number 1 January-February 1992


LEGAL HISTORY, LEGAL ECONOMICS, AND THE BILL
OF   RIGHTS


Enterprise and American Law, 1836-1937. Herbert
Hovenkamp.   Cambridge:   Harvard  University
Press, 1991. 443p. ISBN 0-674-25748-0 $39.95.

Reviewed by Ballard C. Campbell
    Herbert Hovenkamp  has produced a brilliant
discourse on the interaction between the law and
economics in American  legal development. Un-
comfortable with the tendency of legal historians to
accentuate political conflict, Hovenkamp contends
that economic theory played an influential role in
shaping public policy and jurisprudence in the United
States. He argues this proposition by tracing the rise
and fall of the classical model of political economy
in Americanjurisprudence between 1836 and 1937.
This web of ideas about business, the economy, and
the law comprised a common intellectualwellspring
for elite lawyers after 1836 and reigned as the
dominant judicial theory during the last half of the
nineteenth century (p. 28).
    Classicism's roots can be traced to Adam Smith,
the Scottish Realists, and early American political
economists such as Francis Wayland and Henry
Carey. The essence of their outlook was that the
private market could be trusted to nurture national
wealth. Recoiling from mercantilist policies whereby


government granted monopolies to entrepreneurs,
classicists condemned public interference with the
private market because it blocked equal access. A
key legal derivative of this theory was the corpora-
tion, which gained protection from its creditors
through limited liability, control by its managers
rather than its owners, and substantial absolution
from meddlesome  quo  warranto proceedings.
Classicists saw the trend toward monopoly later in
the century as the logical outcome of corporate
efforts to survive competition by achieving efficien-
cies of scale. Classical notions permeated most aspects
ofjurisprudence concerning enterprise-including
substantive due process and prevalent attitudes to-
ward labor-during the latter decades of the nine-
teenth century, when the theory's hold on jurists
reached its apogee.
    Some of Hovenkamp's creative analysis focuses
on empirical inconsistencies in the premises of
classicism. The section on Regulated Industry in-
cludes marvelous reviews of the railroads' dilem-
ma over rate-making and the confluence of epide-
miology, political economy, and the law in the
Slaughterhouse cases. Faithful judicial adherence to
classical political economy led to a double standard
                        (continued on next page)


FEATURES IN THIS ISSUE

       Legal History, Legal Economics, and  the Bill of Rights 1
       International Law, Human   Rights, and Development 8
       Fiction, Legal Style, and Biography   12
       International Legal Materials   14
       Debtors, Creditors, Lenders, and Securitization  16
       Punitive Damages:  A State-by-State Guide   20
       Environmental  Law  Anthology 22
       Books  Received   22


Bimonthly Review of Law Books / January-February 1992

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