Written by Katie Porter
I teach business law. Or at least **I** think I teach business law. But to my surprise, some people do not think my courses and scholarship fit into “business law.” What are the boundaries of business law, and what is at stake in defining those boundaries?
Some in the academy would equate business law with “corporate and securities law.” People who teach subjects such as intellectual property law, commercial law, antitrust, and real property are outside such a narrow definition. But this definition strikes me as unduly pinched. Certainly the laws that govern borrowing money–including Article 9 of the UCC (Secured Transactions) and Articles 3 and 4 of the UCC (payments)–are central to virtually every business transaction. It’s not as if businesses barter for goods with chickens, or even pay in cash. Lending, and in particularly secured lending, are critical to businesses of all sizes. Sarah Lawsky (George Washington, moving to UC-Irvine in July) has made a similar observation about tax law, and the ways in which it is often excluded from business law definitions. She points out that tax is an integral part to virtually all business transactions.
What explains such boundaries? I don’t know for sure, and I’ve only been teaching for a handful of years so I lack historical perspective on the subject. But I suspect some of it has to do with the ways in which the prominence of the law and economics movement in corporate law. I think sometimes “you don’t do business law” is code for “you don’t do MY kind of business law”–that is you don’t do law and economics. Of course there are economics-oriented scholars in the other business disciplines but I think law and economics dominates corporate law in a particular strong way, probably in part because of the overlap between corporate finance and economics theory. And of course, there is the important question of what one means by law and economics, as Angela Harris’ recent post explored. If by economics we mean the forces that brought the world economy to its knees, then research such as mine on mortgage servicersand overleveraged households is law and economics. But such a broad definition may not be a “Pareto improvement,” as it could challenge the existing law and economics establishment, forcing them to share the business law pie with a broader range of scholars.