Six dozen scholars from China, Taiwan, and Hong Kong lined up on the steps behind the Law School, waiting eagerly to have their photograph taken with a man that many consider a personal hero. When Professor Ronald Coase appeared at the door, they erupted into applause.
These scholars are very familiar with the work of the Law School’s Professor Emeritus and Nobel Prize Winner. They have read his writing, assigned his papers to classes they teach, and have worked to apply his insights to the Chinese legal system. Simply put: As the father of law and economics, Coase is a rock star to them. So naturally, they swarmed around him, snapping his picture and thanking him for his many contributions.
Their enthusiasm didn’t end there. The 72 students of the Chicago Summer School in Law and Economics, which focused on Property Rights and Private Law, were intent on learning all they could during the intensive two-week course from July 9 to 20.
In China, where most of the scholars reside, the academic discipline of law and economics is a new one, full of potential insights for the country’s rapidly evolving legal and economic systems. So these scholars chose to travel the 6,500 miles or so to Chicago to study at the birthplace of law and economics, the University of Chicago Law School.
The curriculum included four courses over two weeks. The students studied Property Rights and Public Choice with Professor Saul Levmore, the Law and Economics of Private Remedies with Professor Omri Ben-Shahar, Property and Capital Markets with Professor Douglas Baird, and the Economics of Contract Law with Professor Eric Posner. They heard lunchtime presentations from several law professors, including Richard Epstein, Martha Nussbaum, Richard Posner, William Landes, and Professor Coase himself.
“I read his article maybe 10 years ago. I never guessed I could see him in person,” said Ching-Ping Shao, Associate Professor in the College of Law, National Taiwan University, during a July 12 welcome banquet that Coase attended. “It’s as important as the class, to see him in person. It’s very important to your life…to see someone so famous in real life makes you think again of all the things you learned from him (and) makes you relive your life again when you were 22 and first read his paper.”
Like Shao, many students talked about how they wanted to apply the tools of law and economics to complex legal and economic problems in China. Most of them were law professors, with a few economists among the group. The program welcomed 72 students in total: 65 from China, six from Taiwan, and one from Hong Kong.
Professor Ben-Shahar, the Director of the Institute for Law and Economics, told the group at the banquet that he hoped that “this is the first meeting of the Chinese law and economics association.” He encouraged the scholars to build on what they learned in Chicago to further develop the field at their universities, and to create opportunities to publish and present cutting-edge work in Chinese law and economics.
Dean Michael Schill echoed that idea before introducing the banquet’s keynote speaker, Guoqiang Yang, Consul General of the People’s Republic of China to Chicago.
“What I am hoping is that in 20 years you will all look back on this day, and the next two weeks, as a very important time in your lives,” Schill said. “Law and economics in China can help illuminate legal principles just as it did in the United States.”
The students had many ideas on how these tools could be used back home.
For example, at lunch one day a group of scholars discussed how law and economics might help them understand the effects of China’s property laws. In China, the state owns the land, but people may buy land-use rights that can last 30, 40, 50, or even 70 years. It’s unclear what happens when those rights expire, and the limited nature of the rights might cause people to underinvest, the students explained. Because law and economics studies incentives, legal behavior, and how rules affect public behavior, it can help policymakers understand what kind of real effects the property laws have, the students said.
Gradually, scholars who understand law and economics may be able to influence government leaders and judges in China, said Jun Zhao, a Lecturer and Head of the Research Institute of International Law at Guanghua Law School, at Zhejiang University in Hangzhou, in eastern China.
“If they can integrate economic analysis into some of their decision-making processes, that can be very valuable,” he said.
Guobin Cui is an Associate Professor teaching intellectual property at Tsinghua University School of Law in Beijing. His people “have a lot of legal problems,” he said. “Maybe by applying these legal tools we can have a better legal system, and it will help people in the future.”
Chien-Chung Lin, an Assistant Professor at National Chiao-Tung University in Hsinchu City, Taiwan, added that a rational focus on complex political and economic issues, such as city planning, is important.
“Sometimes ideology will dominate our behavior,” he said. “I think law and economics provide a balancing force.”
Lin and other students noted the difference in the teaching method at Chicago compared to their home universities.
“The teaching style here is more focused on questions, the problems,” Lin said. “They want you to think, but you don’t have to have the answer.”
The students’ schedule was packed during their time in Chicago. Every day at lunch, a different speaker shared his or her research and insights in law and economics. Professor Richard Epstein offered his ideas about the importance of state protection for an efficient private property system. Professor Martha Nussbaum talked about the different ways, economic and otherwise, to measure human welfare and to enhance equality of opportunity around the world. Judge Richard A. Posner outlined how economic and other consequences impact judges. His research partner, Professor William Landes, provided further research into when and why judges are likely to dissent or avoid dissenting, part of the research included in their upcoming book on judicial behavior. Professor Randal Picker led a lively Q&A session on intellectual property and antitrust law. Richard Sandor, Lecturer in Law and CEO of Environmental Financial Products LLC, told the students that China has the opportunity to lead the global effort against climate change. Coase described his “high hopes” for China and encouraged them to replicate their success in the product markets to become leaders in the “market of ideas.”
Coase encouraged the scholars to focus not on abstractions but on the workings and effects of the economic system as it exists in reality.
“Study the economic system in China and find out exactly how it operates, where it might be better,” he said.
Later, a student asked Coase what lawyers could do to further law and economics in China.
Coase’s answer was simple: “Write about it, the way the system works in the real world. Discuss why it’s done this way, but what could be different. This will have an influence not only in China but also in countries in the West…you can have a great influence in your writing.”
Besides classes and lectures, the students also had the chance to present their scholarly work to small groups moderated by Professors William Hubbard, M. Todd Henderson, Anthony Casey, Randal Picker, and Lee Anne Fennell during a July 16 colloquia for student papers.
The scholars had time for fun too: They attended a Cubs game at Wrigley Field, where they got to see a grand slam (albeit one hit by the ultimately victorious Miami Marlins). Before the outing, Richard Badger, Assistant Dean for Graduate Programs, explained the nuts and bolts of baseball to the Chinese students, who were largely unfamiliar with the sport. The Taiwanese students, on the other hand, were well-versed in baseball, which is popular in their country.
On another afternoon, about 50 students took a bike trip up the lakefront to Navy Pier, led by Levmore and Professor Julie Roin. The eight-mile trip ended with pizza. On the weekends, students took their own trips to Chicago sights such as Navy Pier and the Art Institute of Chicago.
At the final event, a July 20 barbeque at Ben-Shahar’s home, many students expressed sadness to leave, the professor said. He later heard that some stayed up until the early morning hours in their last night in the campus dormitory, talking about the experience.
The Summer School is part of the Law School’s Globalizing Law and Economics Initiative, which seeks to introduce these ideas to scholars around the globe. The Law School hosted a conference on European contract law in April, and similar international programs are in the planning stages. The Summer School is intended not just for China but to grow in coming years to welcome scholars from many countries.