Kerber, Wolfgang --- "Transnational Commercial Law, Multi-level Legal Systems, and Evolutionary Economics" [2011] ELECD 249; in Zumbansen, Peer; Calliess, Gralf-Peter (eds), "Law, Economics and Evolutionary Theory" (Edward Elgar Publishing, 2011)

Book Title: Law, Economics and Evolutionary Theory

Editor(s): Zumbansen, Peer; Calliess, Gralf-Peter

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781848448230

Section: Chapter 13

Section Title: Transnational Commercial Law, Multi-level Legal Systems, and Evolutionary Economics

Author(s): Kerber, Wolfgang

Number of pages: 25

Extract:

13. Transnational commercial law, multi-level
legal systems, and evolutionary economics
Wolfgang Kerber

1. INTRODUCTION

Markets need a complex set of institutions in order to work properly. Within a state,
the national legal order with its legal rules, courts, and enforcement agencies have the
task of fulfilling this role. Besides safeguarding property rights, the national legal order
encompasses (1) the facilitating of market transactions by offering enabling (facilitative)
law (as legal standard solutions) and helping private parties to enforce contracts within
the domain of freedom of contract, and (2) the regulation of market transactions for
solving or mitigating market failures problems and achieving other policy objectives. A
comparable consistent legal system is missing on the international level for ensuring the
working of global markets and the governance of cross-border transactions. However,
the dynamic process of globalization has brought about the development of a number
of new institutional solutions for solving these problems. The most prominent issue is
the regulation of international markets (`global governance'). This chapter, however, will
focus on the evolution of institutions for the enforcement of contracts for cross-border
transactions between firms. Although there have always been institutional solutions for
the governance of cross-border contracts (lex mercatoria), in recent years, a number of
new governance solutions for the enforcement of cross-border transactions have emerged
(`transnational commercial law').1 The increasing use of choice of law, private govern-
ance instead of private law (provided by states), and private arbitration instead of public
courts are the ...