Despite the (partially) fierce criticism of a quantitative approach to comparative law, the use of statistics to answer comparative law questions seems to have inspired some new comparative law research. A working paper by Mathias Siems with the title A Network-Based Taxonomy of the World’s Legal Systems uses statistics in order to “develop a difference-based taxonomy in accordance with the idea of legal families.” (p. 10)
After discussing pros and cons of classifications in comparative law, Siems comes up with three groups of four variables ranging from “English as official language” to “Paid annual leave.” He then applies these variables to a dataset of 157 countries in order to determine the difference of each single variable with the same variable for each of the remaining countries. This allows him to plot a histogram for the distribution of the country differences which in turn allows him to create and graphically represent cluster for all the 157 countries studied. Siems subsequently applies his variables to the legal origins literature concluding – somehow surprisingly – that his “network data does not support the legal origins taxonomy.” (p. 17) The last part of the paper is dedicated to developing an alternative classification of the legal systems of the world. By playing with numbers, Siems comes up with four groups: “The Global Anglosphere”, “The Modern European Legal Culture”, “The Rule by Law or Religion” and the “Weak Law in Transition”.
With his paper, Siems opens an interesting avenue for comparative law research. Statistics in general and network analysis in particular may play a role in helping to answer sometimes longstanding questions in comparative law. Yet, statistics are not inherently objective and they need to be properly applied in order to make use of their full potential. In this regard, Siems’ paper raises several concerns. First, the choice of variables by Siems – while well elaborated though probably extendable from a legal standpoint – is problematic from a statistical viewpoint as he mixes categorical variables (here questions with yes/no answers, e.g. “Islam state religion”) with ordinal (or numerical) ones (where the answer lies on a spectrum, e.g. “literacy rate”). Also, the exact translation of the variables into numbers is not really explained. Second, Siems does not really elaborate on the reasoning behind the thresholds (“cut-offs”) for his clusters. Some representations are based on a 0.11 threshold, others on 0.13. Why these thresholds were chosen remains unclear. Third, the conclusion that the classification of the legal systems according to their legal origins is wrong rests on shaky statistics. Little details are given as to the numbers and the reasoning seems somehow circular. Fourth, Siems selects the number of groups into which legal systems can be divided randomly by playing with different numbers and looking which number of groups makes more sense. This, of course, takes away a lot of objectivity from the study.
Overall, the general idea behind A Network-Based Taxonomy of the World’s Legal Systems by Mathias Siems, i.e. to examine traditional issues of comparative law is very innovative and may potentially shape future comparative law research. As any pioneering work it inevitably faces some challenges – mostly due to the fact that the statistical analysis of networks is complex and at the same time so foreign to the conventional way to think about law.
Mathias Siems, A Network-Based Taxonomy of the World’s Legal Systems, 2014 Working Paper Durham Law School, available here.
Quantitative comparative law rests on four main premises: (1) Legal systems are different; (2) Differences can be traced back to legal origins – the civil law tradition and the common law tradition; (3) Legal rules differ due to historically rooted differences in policies: market support (common law) versus policy implementation (civil law); (4) Legal differences can be quantified. Thus, in quantitative comparative law, legal origins play a crucial role for a country’s political orientation and, hence, economic success. Yet, what does the legal origins theory really entail? It is essentially based on the premise that the legal systems of the world can be traced back to two main sources (or origins): the English common law and the French civil law. (German and Scandinavian civil law are dealt with separately within the civil law group, but most of the publications essentially focus on the dichotomy between English common law and French civil law). Through colonization, conquest and adoption, common and civil law have spread throughout the world and have since shaped our legal environment up to a point where legal origins determine economic success.
To comparative lawyers such a simplistic approach to the legal systems of the world is quite provocative. Two major points of critique have been raised against the legal origins theory. First, the factitiousness of clustering legal systems into groups has been pointed out. As discussed previously, comparative law has started to focus on cultural variability of legal systems. Quantitative comparative law, however, explicitly ignores such cultural nuances in order to focus on big picture differences of laws. Both are, however, just two contrarian approaches to comparative law. In fact, the (artificial) clustering of legal systems into families has a long-standing tradition in comparative legal research and seems to be a legitimate way to facilitate large(r)-scale comparisons. Second, some have pointed out the iffiness of seeing legal origins as the main reason for differences in legal process and economic success. These critics say that legal origins or colonial history are only one of many aspects where the colonial powers diverged. More importantly, colonies also differed in climate and natural resources with the French colonies often on the poorer side. Hence, it is difficult to base economic success on legal origins alone.
- Daniel Klerman et al, Legal Origin or Colonial History?, 3 J. LEGAL ANALYSIS 379-409 (2011).
- Rafael La Porta et al., The Economic Consequences of Legal Origins, 46 J. ECON. LIT. 285-332 (2008).
- Mathias Siems, Reconciling Law & Finance and Comparative Law, 52 M.GILL L J 56-81 (2007).
So far, we have examined cultural comparative law as a social-science-inspired methodology that may help the discipline of comparative law to accommodate modern legal developments, i.e. globalization of laws. In the next few posts, I would like to look at another relatively new comparative law method that was developed by economists: quantitative comparative law.
In the late 1990s, a group of economists (mostly known under the abbreviation LLSV) published several papers examining commercial laws of 49 countries of the world. In doing so, they used statistical tests to determine which laws are more efficient and therefore more likely to attract businesses. With this methodology, they reached the provocative result that
[…] countries whose legal rules originate in the common law tradition tend to protect investors considerably better than do countries whose laws originate in the civil law, and especially the French civil law, tradition. [LLSV 1996, p. 40]
Naturally, this conclusion and even more its inclusion in the 2004 and 2006 Doing Business reports of the World Bank have resulted in a wave of (critical) publications from (comparative) jurists, mostly from civil law countries. The main points of critique were the apparent bias towards the common law tradition (LLSV have a common law background) and the reliance on legal origins to group the legal systems of the world.
I will talk about the legal origins theory in my next post. For now, I would like to focus on the quantification as a possible methodology in comparative law. In contrast to cultural comparative law, quantitative comparative law looks at large samples of legal systems which are clustered and quantified. The use of numbers as a comparative tool, makes the comparison more objective and leads to clear-cut results. Such results, however, can be misleading in two ways: First, depending on the choice of variables, results may be biased – usually towards the legal system with which the author of the study is most familiar. Second, laws are never identical and their substitution with mere numbers may obliterate legal diversity. So while quantification may provide a valuable overview and might be an important first step in a series of comparative analysis, results should be viewed with a grain of salt and put further into perspective.
- Rafael La Porta et al., Law and Finance, NBER Working Paper 5661 (1996)
- Rafael La Porta et al., Legal Determinants of External Finance, 52 J. OF FINANCE 1131-1150 (1997)
- Rafael La Porta et al., Law and Finance, 106 J. POL. ECON. 1113-1155 (1998)
- Ralf Michaels, Comparative Law by Numbers? Legal Origins Thesis, Doing Business Reports, and the Silence of Traditional Comparative Law, 57 AM. J. COMP. L. 765-795 (2009)
- Catherine Valcke, The French Response to the World Bank’s Doing Business Reports, 60 UNIV. TORONTO L J 197-217 (2010)