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Luhmann without tears: complex economic regulation and the erosion of the market sphere

Published online by Cambridge University Press:  02 January 2018

David Campbell
David Campbell*
Affiliation:
University of Leeds
*
David Campbell, Professor of International Business Law, School of Law, Liberty Building, University of Leeds, Leeds, LS2 9JT, UK. Email: [email protected]
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Abstract

One of the concepts central to the ‘reconceiving’ of the ‘regulatory state’ during ‘the age of regulatory reform’ which we might trace back to the neoliberal revolution of the 1970s, has been that of the ‘hybrid’ form of economic organisation. Rejection of command-and-control regulation led, in the public sector, to the adoption of ‘marketmimicking’, a technique that claimed to replace the hierarchical direction of planning with the mobilisation of self-interest in ‘quasi-markets’, thereby merging ‘economic’ incentivisation with the ‘political’ stipulation of the markets' outcomes. In the private sector, institutions that had long been recognised to sit between contract and the company, of which the franchise had been the most thoroughly analysed within contract law, began to be regarded as ‘networks’.

Type
Research Article
Information
Legal Studies , Volume 33 , Issue 1 , March 2013 , pp. 162 - 186
Copyright
Copyright © Society of Legal Scholars 2013

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Footnotes

*

I am grateful to Oliver Gerstenberg, Matthias Klaes and Jiri Přibáň for their comments, to which the normal disclaimer applies in force.

References

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6. I must point out that I have contributed to this series.

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15. I leave aside the relationship of this classification to the larger number of ‘specific risks of networks’ identified in ch 1 (100–111).

16. The problems set out in chs 4 and 5 are regarded, it seems perfectly legitimately, as third-party problems by Marina Wellenhofer and Manfred Wolf in their Fribourg papers: Wellenhoffer, M,‘Third party effects of bilateral contracts within the network’ in Amstutz, and Teubner, (eds), above n 8;Google Scholar Wolf, M,‘The protection of contractual networks against interference by third parties’ in Amstutz, and Teubner, (eds), above n 8.Google Scholar Wellenhofer, loc cit, 129, is of the opinion that ‘there is no need for a new innovative approach’. Wolf reaches the opposite conclusion.

17. Hereinafter BGB.

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19. A long second part of this subsection has special provisions for conveyances of interests in land.

20. With Heerman, I am unsure whether it is possible ever to include end consumers in the network, or what Teubner's position exactly is on this. This statement of the proprium of connected contracts seems to exclude it, but it seems to be necessary if regulation in their interests is to be possible on the basis of identifying a network: Heermann, PW‘The status of multilateral synallagmas in the law of connected contracts’ in Amstutz, and Teubner, (eds), above n 8, p 110. The point is also taken by Collins (65).Google Scholar

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60. Campbell, and Klaes, , above n 43, pp 273–276.Google Scholar

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62. Collins cites two excellent, thought-provoking papers on this point. I would add that in arguably the most influential body of academic work on the subject, that of Stewart Macaulay, the point is also taken: Macaulay, S‘Long-term continuing relations: the American experience regulating dealerships and franchises’ in Joerges, C (ed)Franchising and the Law (Baden Baden: Nomos, 1991). Teubner refers to this paper (101 n 95).Google Scholar

63. Reinhard Böhber's Fribourg paper, whilst much more sympathetic to a position like Teubner's than I am, seems to me to authoritatively raise many important problems: Böhner, R‘Asset-sharing in franchise networks: the obligation to pass on network benefits’ in Amstutz, and Teubner, (eds), above n 8.Google Scholar

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71. Luhmann, N A Sociological Theory of Law (London: Routledge and Kegan Paul, 1985) pp 167–168.Google Scholar Luhmann gave a revised statement of the point in Luhmann, N Law as a Social System (Oxford: Oxford University Press, 2004) ch 11.Google Scholar

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81. Perhaps what is fundamentally novel in Luhmann's conception of social systems is his abandonment of Parsons' input/output conception of those systems. It is not functionalism as such but any causal relationship with the environment that Luhmann rejects: Luhmann, Law as a Social System, above n 72, pp 382–383.Google Scholar

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88. In the view of Matthias Klaes and myself, attempts to reduce global greenhouse gas emissions are inevitably bound to fail because of shortcomings in the international climate change negotiations that have followed the UN Framework Convention on Climate Change: Campbell, D, Klaes, M and Bignell, C ‘After Cancun: the impossibility of carbon trading’ (2010) 29  U Ql LJ 163.Google Scholar This has not prevented the burgeoning growth of national and international institutions committed to this impossible project; and, as we write, these institutions remain largely immune to the now unchallengeable evidence of the immense growth of emissions over the 20 years since the Framework Convention was opened for signature in 1992. Our initial understanding of this phenomenon was in terms of Luhmann's view on environmentalism, though we have been unable to give a sustained account of it in those terms.

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92. There are, of course, other concepts that seek to capture something like Luhmann's point. Moran has a concept of ‘hyper-innovation’, which itself is very interesting but does not capture the reflexivity of Luhmann's hypercomplexity.

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96. Ibid.

97. Ibid.

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102. Ibid, p 176.

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104. Ibid, p 27.

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107. Teubner, above n 13. In a 2002 paper focusing on just in time manufacturing, Teubner anticipated criticisms such as those Daintith and I have put forward of network regulation, but defends the possibility of such regulation, though ‘totally incomprehensible from the Anglo-American standpoint’, as appropriate to Germany because ‘it makes sense, however, if one takes into account the varieties of capitalism’: Teubner, G ‘Idiosyncratic production regimes: co-evolution of economic and legal institutions in the varieties of capitalism’ (2002) 112 Proc Br Acad 161, 180–181.Google Scholar

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109. Born in what is now the Czech Republic, Renner's education and his professional and political life were entirely centred on Vienna under the Austro-Hungarian Empire and subsequently the Austrian Republic, the Third Reich and the Second Austrian Republic. He supported Anschluss throughout the interwar period. The point is that the intellectual milieu of his views was German.

110. Kahn Freund also preceded Collins as a Fellow of Brasenose College, Oxford.

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130. Prior to Collins' Introduction, Roger Brownsword, sometimes in work with the late John Adams, had done the most to develop the network idea within the English law of contract. His Fribourg paper helpfully reviews an important body of work going back to 1989: Brownsword, R‘Network contracts revisited’ in Amstutz, and Teubner, (eds), above n 8.Google Scholar Reasons of space prevent me from exploring the English law literature on networks. I will say only that Brownsword's work has struggled with the fact that it was principally stimulated by Junior Books Ltd v Veitchi Co Ltd [1983] 1 AC 250 (HL), which, though at the time lauded as a way of getting round an illegitimate contractual way of determining the range of liability, surely was an inauspicious foundation. But in Collins' Introduction (55–56), we find him welcoming the possibility that the Teubnerian network might put fresh legs under Junior Books. This seems to revive views Collins held about this case in the 1980s, from which he had, out of greater respect for the parties' allocation of risks rather than what was needed ‘as a matter of fairness’, moved away: cf Collins, H The Law of Contract (London: Weidenfeld and Nicolson, 1986) pp 109, 113;Google Scholar Collins, H The Law of Contract (London: Butterworths, 4th edn, 2003) pp 323, 327–328.Google Scholar

131. I am seeking to turn Teubner's own usage against him: Teubner, , above n 121, pp 3–10.Google Scholar

132. Druey, , above n 26, pp 95–96.Google Scholar