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May 04, 2010

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Michael F. Martin

"The specific role of social systems, such as law, economy, politics and religion, is to contribute to the emergence of forms of meaning through which the complexity of the
world can be understood. The evolution of ‘meaning’ marks ‘a new way of combining closure and openness in constructing systems’ (Luhmann, 1995: 38) based on the aggregation and integration of information over time. Social systems are more or less
effective according to the degree to which they can simultaneously increase the flow of information from the external environment, and their internal capacity to absorb and process that information. Thus ‘[t]he theory is not concerned, like classical theories of equilibrium, with returning to a stable state of rest after absorption of disturbances, but with securing the constant renewal of system elements – or, more briefly, not with static but with dynamic stability’ (Luhmann, 1995: 49).

To say, then, that the legal system functions as a cognitive resource means that it operates in a cycle of interaction with its external environment. The legal system receives information from the external environment, processes it in forms which are specific to the creation of legal or juridical meaning, and returns this information to the environment in the form of legal communications. The capacity of economic system, in its turn, to receive this information, depends on the existence of institutions capable of receiving and processing legal information. The idea that laws are like prices is half right, since prices embody highly complex information about supply and demand in ‘coded’ form which facilitates decision making by agents who may be distant in time and place from the initial market movements (Sugden, 1998a). But just as the economy possesses its own particular mechanisms for the creation of information in the form of prices, so the legal system possesses its own internal logic, which is not that of the market. This requires us to consider more closely the internal logic of legal ordering."

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1581746

I agree with Judge Posner (who at least elsewhere has argued) that the semantic arguments are partly there to make a process, which can have such dramatic personal consequences for its participants, easier for lawyers and judges to handle psychologically. But I'm not sure this is can be understood entirely as a form of cognitive dissonance. That seems to assume that there is a unitary framework for understanding policy consequences (such as cost-benefit analysis), an assumption that fails spectacularly outside particular domains.

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