Law Commons^™

Incomplete Law, Katharina Pistor, Chenggang Xu

Faculty Scholarship

This Article develops a framework for analyzing the relation between basic features of statutory and case law and the design and functioning of institutions that enforce this law. The basic premise is that law is inherently incomplete and that this has important implications for law enforcement. In particular, when law is incomplete, special emphasis needs to be placed on the allocation of lawmaking and law enforcement powers (LMLEP) to different institutions such as legislatures, courts, or regulators, in order to attain optimal levels of law enforcement. Using the development of the legal framework governing financial markets as an example to …