The research activities of the Rule of Law Program aim to focus scholarly attention on issues relating to the structures and strategies of public, private and nonprofit international organizations, particularly with respect to their operations in societies in political and economic transition.
The program examines critical dimensions of the relationship between economic development and economic rights in rule of law-based systems. The purpose of the research is to move beyond assumptions associated with both the rule of law and with traditional and modern substitutes for the rule of law to understand their current and prospective role in risk management, especially in developing Asian countries. The Rule of Law Program also examines the role of legal institutions in transition countries, a part of which is the Annual Research Workshop.
The mainstream in current literature assumes that rule of law is a necessary condition for economic development: that economic rights provide individuals and firms the certainty needed to trade at low cost with a wide circle of strangers and to make long-term investments. Early hypotheses about economic rights emphasized property and contract. A later hypothesis related to regulatory risk arising from government intervention with resource use and organizational diversity. Hypotheses developed in the new economy era concentrate on corporate governance and finance. And, by virtue of the experience of start-up businesses in the new economy, hypotheses are emerging that relate to the shifting relationship of economic organization to innovation. Others contest the assumption that the rule of law is important to economic development, citing substitutes for the rule of law that are prominent in rapid growth economies like China. These proponents cite traditional substitutes for the rule of law including familiarity with trading partners, custom, family relationships and corruption. Modern substitutes include political administration, credit rating agencies, insurance, network relationships, and vastly improved information density related to all of these substitutes.
Consequently, the Rule of Law Program will begin to answer a fundamental set of questions that includes the following:
To answer questions, such as those posed above, and to clarify the premises and hypotheses that underlie this debate, three dimensions of rule of law will be investigated: the economic law regimes in selected East and South Asian countries; the consequences of the absence of rule of law on economic rights; and the capacity of judicial systems to respond to the challenges and increased burdens posed by the expansion of economic rights. Finally, based on consideration of these subtopics, a prospective study will suggest parameters for responsive reforms in the rebalancing of governance to improve the rule of law with respect to economic rights and development.