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The Evolution of a Legal Rule
The Journal of legal studies
Efficient legal rules are central to efficient resource allocation in a market economy. But the question whether the common law actually converges to efficiency in commercial areas has remained empirically untested. We create a dataset of 461 state-court appellate decisions involving the economic loss rule in construction disputes and trace the evolution of this law from 1970 to 2005. We find that the law did not converge to any stable resting point and evolved differently in different states.doi:10.1086/652908 fatcat:wobrulcgbvfm3dacxk3wnxhvlq