Reasons why national economies are weak or strong: 1.

) Dependency theory: Argues that economically strong nations exploit the resources and labor of weaker nations through trade. 2.) Natural resources: Small nations are well off only because they have a single natural resource like oil and are able to sell to other nations with strong, diverse economies. 3.) Education and Technology: Economically strong= More education and technology use. 4.) Climate: Too hot=less able to work. Strong economies can survive this. Ex= Singapore. 5.) Private market: 6.) Law and Legal System: Adequately enforced system of equally applied law= foundation for strong, productive economies. Certain framework of law is necessary for maximum incentive to entrepreneurs, investors and inventors. Law secures element of trust and certainty vital to economic transactions among strangers. Concepts for a Successful Private Market in the Modern Nation: Law: Most significant of social forces because it can glue together diverse peoples of difference backgrounds into very large, organized groups. Tells members of societies what they can or can not do. o Law is made up of rules. These rules are laid down by the state and backed up by enforcement. o Is a formal social source: written and available to anyone Rule of Law: laws that are made are generally and equally applicable. Apply to all or most members of society and apply to various groups in the same way. o Rule of law nations adopt laws supporting the private market because it is in everyones interest, including the lawmakers. o Special interest groups attempt to persuade lawmakers to benefit these groups at the expense of others. Property: legal right to exclude or keep others from interfering with what you own, with your resources. o Legal right to exclude=turn to public authorities (ex police, courts) o Ways of applying exclusionary right of property are: Public property: public resources owned by govt like roads, public buildings/ land, monuments Private property: resources you won as an individual Common property: Resources that more than 1 individual jointly owns. o Property=ownership o Enforcement of property right under rule of law gives people incentive to develop the resources they own.

o Property based legal system enables control by allowing people to exclude others from interfering with what their efforts produce. o Contract law: enables owner to exchange resources o Tort Law: compensates owners whose resources are wrongfully harmed by the actions of others o Criminal law: punishes those who harm and owners resources in particular ways. o Corporate governance: specifically concerns the law protecting the owners of a business organization from the managers who run it for them. Any law regulating and limiting private owners productive resources and their use. Jurisprudence: Philosophies that explain the origin, justification, meaning, and essence of law. o Natural law: Aristotle and other ancient philosophers, asserts that law contains universal moral principles that are observable in nature and we can determine them through human reason. o Positive Law: Believes that law is simply the commands of the state backed up by force and punishments. Is contrary to philosophy of natural law. o Historical school: emphasizes that contemporary law should focus on legal principles that have withstood the test of time in our nation. Law reflects the cultural traditions of a people and recognizes that different nations may have different traditions, and thus different laws. o Sociological Jurisprudence: Law can and should change to meet new developments in society. o Legal realism: Goes beyond just the words of law to examine what police, administrators, prosecutors, and judges are actually doing as they enforce, interpret, and apply laws. o Sociological and legal are types of positivism. Common law: Legal system that emphasizes the role of judges in determining the meaning of laws and how they apply. o US, England, India, Jamaica, Canada, Nigeria, New Zealand, and few other countries colonized by England. o Judges: Can determine the meaning of the Constitution and can declare void the legislation of Congress and the acts of the President. Civil Law: Relies more on legislation than judicial decisions to determine what the law is. o Worlds nations not colonized by England o Civil Law courts dont make laws nor do their judges think themselves obligated to follow prior judicial decisions, called precedents. Public Law: Includes those matters that involve the regulation of society as opposed to individuals interacting. Govt official represents society and attempt to seek justice to achieve the ends of society.

o Constitutional law: Involves the interpretation and application of either federal or state constitutions. o Administrative Law: Covers legal principles that apply to government agencies, bureaus, boards, or commissions o Criminal law: Specifies various offenses against the proper order of the state Private law: Concern your private resource relationships with other people o Property law: Recognition of exclusive right in physically touchable and untouchable resources. Ex- land, copyrights, patents, goods, etc. o Contract law: Rules of how owners transfer resources by exchanging them. o Tort Law: Establishes rules for compensation when another wrongfully crosses an owners legal boundaries. Often requires actual injury to owners resources. Substantive Law: defines the legal relationship of people with other people or between them and the state. o Defines rights and duties Procedural Law: deals with the method and means by which substantive law is made and administered. The time allowed for one party to sue another and the rules of law governing the process of the lawsuit are examples. o Provide the machinery for enforcing rights and duties. US Constitution= Supreme law of the nation. Establishes the federal govt, and its amendments guarantee basic right s and liberties to the people of the nation. Legislation: Formal written laws o Legislative bodies exists at all levels of government o Statute or Act: Legislation adopted by Congress or a state legislature. o Ordinances: Laws passed by local governments. o Compilations of legislation at all levels of government Uniformity in the law: o Congress can enact a single law that overrides varying state laws. o State legislatures can all adopt a single uniform law in a particular area. Uniform Commercial Code (UCC): Collects in one body the law that deals with all the phases which may ordinarily arise in the handling of commercial transactions from start to finish. o Covers law relating to the sale of goods, the use of checks, and other forms of commercial paper and the giving of security to ensure the buyer will pay the purchase price of goods. o Applies only to purchases and sales of personal property like goods, not contracts to sell lands or personal service. Statutory Construction: The rules courts use in interpreting the meaning of legislation. Administrative regulation: Agencies that regulate business activities through the adoption of rules and regulations.

o Ex: Environmental Protection Agency (EPA), OSHA, SEC Case Law: Judicial decisions that interpret the relevant constitutional, legislative, and regulatory laws. o Opinions: The decision of a judge, usually in written form o Precedents: A prior judicial decision relied upon as an example of a rule of law. o Citation: The reference identifying how to find a case. EX: 313 N.W.2d 601 (1982)= Page 601 of volume 313 of Northwestern Reporter, second edition, a case decided in 1982. o Advantage of Case Law: Stare decisis: Doctrine of prior precedents. Under this judges in current cases follow whenever possible the interpretation of law determined by judges in prior cases. Advantage: People became secure in their right for property. Then willing to invest resources in fixed locations for factories and other immovable valuables because they were certain the state wouldnt seize them for their own cause. o Disadvantages of Case Law: Volume of cases- time consuming (for lawyer) and expensive (for client) Conflicting precedents: Dont create confidence in certainty of law Dicta: Holding in prior cases are precisely what was necessary to the decision reached. Dicta are w/e else the court said. Judges in future cases follow holdings more. Rejection of precedent: B/c of stare decisis, courts usually hesitate to reject the precedents of prior cases, but sometimes do. Constitutional Relativity: In constitutional law, the idea that courts should understand the meaning of the Constitution relative to the times in which they interpret it. Conflict of law: Rules of law the courts use to determine that substantive law applies when there is an inconsistency between laws of different states or countries. Hierarchy of source of law from Highest to lowest: o US Constitution and Amendments o Statutes (acts or legislations) of Congress o Federal admission regulation o State Constitutions o State Statutes o State Administrative regulation o Local ordinances o Case Law (court cases, as they interpret all of the other sources, may or may not void sources lower than the source being interpreted)