This chapter applies the economic analysis of law to the harmonization of private law in Europe. The economic starting points following from the economics of federalism are explained and the question is asked to what extent these criteria can lead to arguments in favour of centralization. Attention is paid to a variety of arguments such as cross-border externalities, the race-to-the-bottom and harmonization of marketing conditions. It is also explained to what extent these arguments were de facto used in Europe to justify harmonization of private law. To the extent that private law harmonization in Europe in some cases seems to go further than needed from an economic perspective, the question is asked what can be the explanation for the particular deviation. Interest group analysis is used to provide such an explanation.
In this chapter the economic approach to environmental governance generally and to environmental law in particular is explained. Attention is paid to the goal of environmental policy from an economic perspective, but also to the economic meaning of environmental principles. The question is equally addressed whether there is a convergence or a divergence between the economic and the legal way in which environmental law is approached. Specific attention is devoted to environmental liability, to economic instruments and to optimal enforcement mechanisms.
This chapter deals with the harmonisation of EU tort law from the perspective of the economic analysis of law. The chapter discusses the basic principle of competition between legal orders as a starting point of the economics of federalism. It shows that the transboundary character of specific problems may be an argument in favour of centralization. Then the danger of a so-called race-for-the-bottom is discussed as well as the traditional argument of the European discourse that the harmonisation would be needed to further market integration. The reduction of transaction costs is also advanced as an argument in favour of harmonisation. The chapter also discusses the possibility of providing a minimum level of protection, although arguing that it does not fit into the economic rationale. A few policy recommendations and concluding remarks conclude the chapter.