Economic Analysis of Law though seemingly clear, is a vague phrase. There are a lot of misunderstandings about its true nature. In many cases it seems that there are confusions between Economic Analysis as a method on one hand and Economic Analysis as a discipline on the other hand. Economic Analysis of law analyzes legal matters by methods and techniques originally used by economists to analyze market issues and as such, it does not explain the economic impacts of law or legal aspects of economics. To find out what the very nature of economic analysis of law is, we must focus on the meanings of “Analysis” and “Economic”: Economic analysis means to translate law in economic language and then to analyze it, as we analyze market research.
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