The Underrated Bruno Leoni (with Michael Munger)
Sep 30 2024
download-3.jpg
Bruno Leoni (1913-1967)

Friedrich Hayek credited Bruno Leoni with shaping his ideas on laws and legislation. James Buchanan said that Leoni identified problems that led to his own work on public choice. How is it possible, then, that so few of us know of the groundbreaking Italian political philosopher? Listen as Duke economist Michael Munger talks with EconTalk's Russ Roberts about Leoni's ideas and the gruesome murder that ended his life before its time.

RELATED EPISODE
Angus Burgin on Hayek, Friedman, and the Great Persuasion
Angus Burgin of Johns Hopkins University and the author of The Great Persuasion talks with EconTalk host Russ Roberts about the idea in his book--the return of free market economics in the aftermath of the Great Depression. Burgin describes the...
EXPLORE MORE
Related EPISODE
Don Boudreaux on Law and Legislation
Don Boudreaux of George Mason University talks about the fundamental principles of economics and civilization: spontaneous order and law. Drawing on volume one of Friedrich Hayek's classic, Law, Legislation and Liberty, Boudreaux talks about the distinction between law and legislation,...
EXPLORE MORE
Explore audio transcript, further reading that will help you delve deeper into this week’s episode, and vigorous conversations in the form of our comments section below.

READER COMMENTS

Eric
Sep 30 2024 at 1:44pm

Michael Munger: …the three main themes that he was interested in were non-arbitrariness, freedom, and then universality. And, we’ve not talked about universality.
The version of the universality rule that is usually quoted is–well, Christians call it the Golden Rule. And that is that I should be as concerned about others as I am about myself.

That is not what the Golden Rule means, but my guess is that Dr. Munger did not actually intend what his words imply.

There is no possibility of being “as concerned about others as I am about myself.” We cannot think about others to the extent that we think about ourselves. We cannot care about others we do not know to the extent that we care about ourselves or those close to us. The rule is not focused on our “concern” or on making our “concern” universal.

Instead, the rule to “do unto others as you would have others do to you” is meant to exclude holding a double standard in our expectations for how people ought to behave. From a tribalistic perspective, it is easy and even expected to hold one standard for how we know we ought to be treated, and yet hold a very different standard for how we ought to treat “those people”. That is the nature of tribalism. (For many examples, consider the double standards on both sides of current political tribes.)

The rule says, “You already naturally care for yourself and intuitively know how you would want to be treated by others. Now apply to other people the very same standard that you would want others to apply to you. Use the same consistent standard, not a double standard.” It is a practical, usable, generalized application of what Jesus affirmed was the second greatest commandment in God’s covenant with Israel (Matt. 22:36-40; Mark 12:28-34).

Connecting to the first part of the conversation, if we take “law” to refer to a sense of normative expectations about how people ought to behave (distinct from “legislation”), then the golden rule could be understood in terms of excluding the very common practice having one “law” that we apply to how we are treated and a different “law” to how we would treat some other people. That would be inconsistent. The golden rule calls us to be consistent without favoritism based on whether or not we are on the receiving end of the action.

Someone might ask, “Why ought I to use a single standard instead of a double standard, even if I am dealing with ‘those people’? Why not treat ‘those people’ differently?”

If we are merely inventing arbitrary conventions as we go, there is no necessary reason why any one convention ought to be applied to all. We differ in many ways. We could invent one convention for “us” and other conventions for “them”. For example, why shouldn’t the strong benefit from oppressing the weak? Most of human history distinguished conquerors and conquered. Why shouldn’t Morlocks benefit at the cost of the Eloi? In nature, there is a common and natural difference between predators and their prey.

The idea of universal human rights cannot be derived from nature or biology. It rests upon the Judeo-Christian declaration that all humans bear the image of God. Expecting that we ought to use a consistent single standard presupposes that there exists a true single standard for how humans are meant to behave toward each other, and that we can perceive this standard somewhat at least in regard to our own benefit.

Michael Munger
Sep 30 2024 at 2:39pm

Eric is right, of course. At BEST, my statement is a gloss on Adam Smith’s restatement of the rule, in TMS.

Anthony Gill
Sep 30 2024 at 6:42pm

Yet another home run with Munger. This came at an almost perfect time in my course on anarchy and self-governance that I can talk about the importance of “bottom up” common law. A key moment was when Munger noted that (common) law doesn’t apply until two disputants have a conflict. This further leaves open room for two disputants to even settle things before taking it to a folkmote or moot court to render a decision. Flexibility, baby.

Oh, and the story of Bruno Leoni’s unfortunate demise was great. I hadn’t known this.

Two political economists who go largely unrecognized that I would like to see might include Peter Kropotkin (late 19th / early 20th century) and Michael Taylor (late 20th). Both were anarcho-communists (if that is a fair characterization) but had much to say on community organization and its limits. Indeed, Taylor (who also had some insights on cooperative game theory) reads as a more formal version of Kropotkin. And while both are anarcho-communists, both could easily be squared with a more classical liberal version of political economy and public choice that sees the value of community decision-making at a more localized level.

Michael Geiser
Sep 30 2024 at 8:45pm

This was a great discussion. I was left with the question of whether Leoni or his followers considered the thought of Oliver Wendell Holmes, Jr. The metaphor of the paths between the buildings echos The Path of The Law, and the talk about moral constraints being more important than legislation brought to mind the Holmesian Bad Man, who cares for nothing but the consequences the law will impose.

Schepp
Oct 1 2024 at 10:08am

An excellent podcast from Munger and Roberts. A few contrarian approaches to Leoni, Munger and Roberts:

I would prefer to be treated with tit for tat, or other incentive-based strategies that improve cooperation and make me and society better off; therefore, I believe tit for tat can comply with the golden rule.

Wonderful point that law can be more powerful when enabled to have emergent form, but several references were made to that leading to fixed law.  I don’t believe fixed, in complete sense, is compatible with emergent. Emergent can be more stable than in application than many forms of legislation, but to be emergent is necessarily (and improvingly on average) changeable.

Judges will have biases and make mistakes. Constitutions and effective legislation may frame the will and custom of a society and improve the basis for emergent law.

The prohibition of murder which is not individually self-enforcing but still is a law.  The consensus of a practical and self-sustaining system of police, prosecutors, judges and juries and prison guards make murder a law versus prohibitions of gambling which are mostly just unenforceable legislation.

Rousseau got most everything wrong, but he did get this right “…the most important law of all is not engraved on marble or brass, but in the hearts of the citizens…”.  Not necessarily arguing for emergence but clearly against believing it is law just because it is written. (I think Dr. Munger in his work informed me of this Rousseau quote, Thank You.)

It is our current challenge to understand the trade-offs of legislative regulation. We get calls for Vision Zero (no traffic fatalities). We see calls for legislative lower-speed limits to achieve that end. But I see little to no understanding of all the costs of enforcing such draconian speed limit that would even approach zero fatalities.

A well-planned campus design frames locations of buildings and transportation (including sidewalk).  A good campus designer takes to heart Eisenhower’s dictate that “In preparing for battle I have always found that plans are useless, but planning is indispensable.”  This concept leads to making plans with flexibility and prepares the designer to be ready to implement beneficial improvements.  The development of the plan is frequently made better through an emergent process in the plan formulation.

Thank you,

Vincent Passanisi
Oct 1 2024 at 2:17pm

What a fun and educational podcast. Just loved this one. I appreciate the sense of humor that Russ and Mike share. This totally made me laugh out loud:

Russ Roberts: And, I let you go on about it because I hear that crime podcasts do really well. So, I figured: Hey, take a chance.

Michael Munger: It’s time you got some listeners.

Jeff
Oct 2 2024 at 12:43pm

Another wonderful episode!  I find myself looking forward to Mondays and the newest EconTalk because I know I’m going to learn and be entertained.

I would be interested in seeing Dr. Munger’s source(s) for his assertion that the Gospel of John was written 200 years after the time of Christ.

 

Thank you, gentlemen!

 

Ethan
Oct 2 2024 at 9:13pm

One thought about legislation that goes unenforced: the public is subject to the caprices of the enforcement agency with legislation. The state can become tyrannical or vengeful through enforcement of previously suggestive laws e.g. a policeman does not like you and writes a ticket for speeding at 66. The myriad legislation is a sword of Damocles.

Trent
Oct 2 2024 at 11:01pm

A very interesting podcast as always when Prof. Munger is the guest.  Found the discussion of Leoni’s definition of law enlightening.

Have to take issue, however, with Prof. Munger’s claim that the Gospel of John was written sometime after 200 AD.  Many Biblical scholars assert all four Gospels were written within a generation of Jesus’ death, with the Gospel of John pegged at around 70AD.  As I’ve posted in other podcasts that involve religion and Christianity, Andy Stanley of Northpoint Community Church in suburban Atlanta would be an excellent guest.

As for Jesus’ commandment for His followers, they are to love one another as He has loved them.  That’s part of His New Covenant that replaces the Old Covenant (e.g. the Leviticus laws that Jesus fulfilled by living a sinless life).  And when you really analyze what that encompasses, it’s actually more demanding than the Leviticus laws.  It’s a standard that all Christians fall short of, but it’s what they are all supposed to strive for.

Eric
Oct 6 2024 at 7:03pm

Mike Munger: “… the Gospel of John is odd. It was written 200 years after the time of Jesus. …”

Trent, I agree that scholars do not make that claim about the plausible dating of John’s Gospel.  “200 years after the time of Jesus” would put well into the 3rd century and I don’t know anyone who thinks that.

At one time, some had thought it was written in the 2nd century.  (Perhaps Dr. Munger simply incorrectly recalled “2nd century” as “200 years after”.)

Nevertheless, several lines of evidence do indeed point to the conclusion that the original Gospel of John was written before the destruction of Jerusalem in 70 A.D. or less than 40 years after Jesus was crucified.  For details about those lines of evidence, see:

John’s Gospel May Have Been Last, But It Wasn’t Late
by J. Warner Wallace

 

Roger McKinney
Oct 3 2024 at 12:53pm

Great discussion! Leoni’s idea that legislation isn’t needed shows the wisdom of God in the Torah. Kings legislated in Moses’ day, so, without a king Israel had not legislators. God gave Israel common law in the Ten Commandments, then provided illustrations of that law in the rest of the 613 commandments. Most of those deal with religious ceremony and moral laws, which the judges didn’t adjudicate, leaving them to the priests and God to enforce. Judges, chosen by the people, adjudicated disputes between people, the civil law. Then God gave Israel example cases, such as unjust weights and measures or cases of fraud. For example, the command to not mix linen and wool in garments is to prevent fraud, like watering down wine. Muzzling the ox that treads the grain prohibits withholding wages from workers. John Walton in Ancient Near East Thought and the Old Testament shows that most of what we consider laws were in reality were examples of applying the law as guides to judges

Alex
Oct 4 2024 at 4:18pm

Just a comment on the use of the path example:    are emergent paths really the best paths?   There is the idea of “path dependence”   The route taken by the first person who starts the path might be idiosyncratic and  then others follow in the footsteps of that first person, entrenching the initial choice,  not because it’s the optimal route, but because it’s easier to follow the established path than to chart a new one.    The result is that you get a path emergently, but there is no reason to think it would be the optimal path.   If that’s how emergent paths work, wouldn’t it still be better to create paths by planning?

Michael Munger
Oct 7 2024 at 7:22am

You imagine that the planner knows what is “best”; why?

The idea of optimization is misleading. As in evolution. There is nothing “optimal” about evolution; the power lies in better replacing worse, for many many centuries. And path dependence is indeed operating, because the improvements are marginal.

That said, there are clearly situations where it is possible for rational people, thinking in groups and making choices, can find “better” paths than those that emerge spontaneously.

And that is why Hayek, and Buchanan, wrote about “Why I am not a conservative.” Their claim is that conservatives always, and only, endorse and defend tradition. But some traditions (slavery, patriarchy, common property) are BAD, and you can’t fix them at the margin.

So the muddy paths are USUALLY, but not always, the best source of law, in that view. And that’s why Hayek did not come over fully to Leoni’s position, for just the reason you give!

Dan
Oct 7 2024 at 11:32am

Doesn’t this negate the arbitrage possibility on behalf of future travelers? Yes it’s possible the first person was confused, drunk, or simply not concerned enough with getting from A to B in the most direct manner. But if A and B are worth getting to and from, wouldn’t the next person have an incentive to do so in the most effective manner? And the second, third, nth people? Just as rivers straighten out over time, wouldn’t we expect to see something similar in the case of campus paths too?

What if there’s a fountain that people like to stop by on the way to class, but it’s not exactly between any two buildings? Would the planner have considered this?

David Thornton
Oct 4 2024 at 6:42pm

Great podcast. I would have really enjoyed the incorporation of a discussion of these principles as they apply to the concept of originalism and the Chevron decision.

Dave Pattie
Oct 6 2024 at 12:25pm

With this episode – and so serendipitous that it is a Mike Munger episode – I’m totally caught up and I’ve now listened to every EconTalk episode (to date).

LEAVE A COMMENT

required
required
required, not displayed
required, not displayed
optional
optional

This site uses Akismet to reduce spam. Learn how your comment data is processed.


DELVE DEEPER

Watch this podcast episode on YouTube:

This week's guest:

This week's focus:

Additional ideas and people mentioned in this podcast episode:

A few more readings and background resources:

A few more EconTalk podcast episodes:

More related EconTalk podcast episodes, by Category:


* As an Amazon Associate, Econlib earns from qualifying purchases.


AUDIO TRANSCRIPT
TimePodcast Episode Highlights
0:37

Intro. [Recording date: September 4, 2024.]

Russ Roberts: Today is September 4th, 2024, and my guest is Mike Munger of Duke University. This is Mike's 48th appearance on EconTalk. Forty-eight. That's 12 times four. That's amazing. He was last here in June of 2024, talking about government failure and market failure.

Our topic for today is Bruno Leoni, his life and his ideas. Bruno Leoni was a political economist you may not have heard of. We're going to base our conversation on an essay of Mike's, part of a series in the Independent Review on underappreciated economists.

Before we start, I want to mention this episode may involve some adult themes. Parents listening with children may want to screen it accordingly.

Mike, welcome back to EconTalk.

Michael Munger: Thanks, Russ. It's a pleasure.

1:31

Russ Roberts: So, who was Bruno Leoni? Let's start with his life, which is surprisingly eventful for an economist.

Michael Munger: Well, and relatively brief, tragically--but we'll get to that. So, he was born in 1913. He died in 1967 in a sensational murder. Alberto Mingardi, who is the head of the Bruno Leoni Institute in Milan, described him as having a frenetic life. Leoni did his studies in Torino and got--and he studied law and the state: and so, it's kind of a different set of categories for academic disciplines in Italy. He ended up with--he had an academic chair at the University of Pavia.

He was quite a successful academic, but he also did a number of other things. He fought in World War II on the Italian side, but then Italy was defeated--kind of tried to withdraw--but it was hard because they were occupied by the Allies at the time. And then, Germany basically invaded Italy, who had been their ally.

And I think it's fair to say Leoni switched sides. He adopted--he became part of what is called the 'A' Force, and they rescued allied POWs [prisoners of war] who had been captured. The Italians tried to release them; the Germans kept them. And he was almost like a partisan, because it was an irregular force, and it was quite courageous for him to have done that.

He went back to Pavia in 1945. He was head of the Political Science Department from 1948 to 1960. I would call him a political philosopher. But, that discipline in Italy, even post-Fascist, Italy was called the Doctrine of the State. And so, you teach a course on the Doctrine of the State. Actually, what he tried to teach was more like the doctrine of freedom and law. He was interested in the nature of law, and his ideas about what law should be--how we should think of the law--is a fascinating, and I think surprisingly provocative intellectual signpost along the way towards what we now think of Austrian economics and public choice.

So, the reason that I think he is underappreciated is that his contributions--and we can talk more about why his contributions weren't recognized as much as perhaps they might've been--but his contributions in retrospect presage a lot of later developments in Austrian economics and in public choice.

And, there's pretty good evidence that they actually caused them, in the sense that he knew James Buchanan. He knew Friedrich Hayek. And both of them reference Leoni's work as having influenced them. But, it was kind of a temporary thing because his death in 1967 ended that.

But, famously in 1960, he shared the stage with Friedrich Hayek, who was then presenting an outline of The Constitution of Liberty; with Milton Friedman, who was working on Capitalism and Freedom. And, Leoni was working on his major book--what turned out to be really his only major book--Freedom and the Law, which was published in 1961. So, that conference was sponsored by the Volker Fund [William Volker Fund], and it was a kind of a high water mark of the 1960s movement towards a rebirth of notions of freedom and criticisms of planning.

He, right after that--partly from knowing Friedman and Hayek and other important people--was made an officer of the Mont Pelerin Society.

Now, the Mont Pelerin Society is a small but important intellectually attempt that Friedrich Hayek and some others had put together in 1947. And, Leoni had been active in the Mont Pelerin Society from the beginning. But, he was elected president of the Mont Pelerin Society in 1967, just months before his death. And so, it does make one wonder what might have happened.

The Mont Pelerin Society was an attempt to recognize that in post-War Europe--and in the United States, for that matter--there was a lack of intellectual coherence in the movement towards opposing this seemingly-inevitable increase in planning and government control of the economy.

So in 1947, it seems kind of hopeless. I have friends now that say it's hopeless. If you go back to 1947, things were much worse. There's all sorts of institutions that we now have. Well, the Mont Pelerin Society in part contributed to that. And, he was president in 1967. So, he was important. He was appreciated. He was a central figure in this movement.

All of that is cut short in 1967. We could talk some about the reasons why, but that's the sort of brief introduction that I would give.

7:24

Russ Roberts: Yeah. Interested listeners may want to go back to the conversation we had with Angus Burgin about the return of free market ideas in the aftermath of the Great Depression and World War II with Hayek Friedman and the creation of the Mont Pelerin Society.

But, I'm fascinated by that event that you allude to, the Volker Fund conference. It's kind of like Woodstock: you've got Friedman, Hayek, and Leoni--

Michael Munger: And others--

Russ Roberts: I was going to say: I would like to see the playlist, the set list. And what I'm more interested in is: Who was in the audience? Or was it just them talking among themselves? Were there people there who have written about or remember that experience, I wonder?

Michael Munger: I'm sure that some of the listeners may know or can find out, and so we will leave that as an exercise to the reader.

Russ Roberts: There you go. There you go.

Michael Munger: For those of you who don't know, that's a standard little thing that you hear in econ textbooks where--

Russ Roberts: It's a joke--

Michael Munger: where, 'This is so obvious that it will be left as an exercise to the reader.'

Russ Roberts: And, in the old days, it meant it was so obvious. And then it became kind of a joke. So, Fermat's Last Theorem: There's a proof I have somewhere around here, but I'll leave it to the exercise of the reader.

8:50

Russ Roberts: Okay. So, post-War Europe was a very--oriented towards central planning socialism or various types of what we might call mixed economies, but with a much heavier dose of planning than had been in the past. And, Leoni is fundamentally active as a intellectual influence for 22 years before he's murdered. So, let's just, before we get to his ideas, talk about what you learned about his death, because it's a little bit voyeuristic, but it's unusual for an economist.

Michael Munger: Well, it is probably pretty unusual for anyone. It's very unusual for an economist.

Russ Roberts: Good point.

Michael Munger: I had read some brief accounts of this. As far as I know, the story has not been told before in English. If we're wrong about that, again: Please, readers, let us know.

But, he was very active as an economist and scholar, but he also had a lot of energy, and he had a side-gig working as basically a fixer for the Olivetti family. So, the Olivetti family is a large Italian manufacturing company. Back when there were things called typewriters--people might remember--

Russ Roberts: I do--

Michael Munger: They made those. His job was kind of an odd one. He worked for the Countess Magda Olivetti. He collected rent for them. So, they had a lot of rental apartments and houses in a number of cities. Torino was the one where he lived, and that's in Turin, which is where he worked.

And, he had hired a printer, a guy named Osvaldo Quero, who lived nearby. And so, what Leoni was trying to do was: he had this job to collect rent. So then he was subcontracting, sending other people out. And, that works great as long as the people that you send out actually turn in the rents. What happened was that Quero was behind in turning in the rents. Now it's not clear if eventually he was going to turn them in or he had just decided he was not going to pay. Quero was kind of a prickly guy.

Let me say that my sources for this are several Italian newspapers of the period. I don't speak Italian, so I just work to translate these. I tried to have two sources for different newspapers for everything that I found.

But so, it is clear that Quero was a printer. He had been described as the best worker at the print shop where he worked. And, he got pretty far behind in the payments. Actually, it was less than $150 worth--it was 80,000 lira. So, to be clear, Quero was collecting rents from tenants. He was the equivalent of $150 US behind in delivering these payments to Leoni, and Leoni demands that he pays--which seems pretty reasonable. And, Quero said that: Well, he'd already sent it by registered mail. And Leoni waited a couple days.

And it was odd that he had sent it by registered mail because the detail was that Leoni demanded to see the receipt. When you send something via registered mail, you've got a receipt. Now all the receipt says is you sent them a letter. I don't know if the money is in it or not.

So, Leoni decided he would fire Quero and demand that they have a meeting. So, they met at the main train station. Leoni went to the post office to check for the registered letter. It still wasn't there. He calls up Quero. And, according to the newspapers--now, these quotes are made up by the newspapers, but this is the account that you get that hasn't been told in English.

Russ Roberts: I was going to say those were the good old days, but of course it's not the good old days. They still make up stuff. But, keep going.

Michael Munger: Yeah, they make up entire stories.

So: 'Look, Quero,' the professor angrily asked, 'Are you sure you sent me those documents?' Now, he hadn't sent the documents, but he said, 'Yes, very sure, by registered letter.' So, he demands to see the receipt, and they set an appointment for 9:30 P.M. at the main train station--the huge train station in Turin. The professor drives up--these details are great--professor arrives in his Mercedes, Quero in his small Fiat. He has no receipt. Quero says, 'Oh, I left the receipt at home.' Like, okay, that'll work. And Leoni demands, 'All right then let's go to your home.' And so, the Mercedes stayed at the parking lot. They went in the Fiat. I'm just imagining this scene, these two fairly corpulent men in this tiny Fiat, very angry at each other, bumping elbows, because it's a 20-minute drive. And, Quero is becoming more and more angry because he feels like his--Quero, the printer, the employee is becoming more angry--because he feels that his honor has been impugned, even though he did in fact try to steal the money.

So, they get to the house. They start to have an argument. Quero apparently killed Leoni by repeatedly bashing his head against a wall. And, other people in nearby apartments heard someone screaming, 'Help, help.' Quero must have been a physically powerful person. It's not easy to beat another person to death by bashing their head against a wall if they're resisting. He continued to beat the body, in a rage, and then he tied the corpse up in a way that was small enough it would fit into a box, put it in the box in his garage, and then goes inside.

Now Mrs. Leoni had been calling the Queros because she knew that the meeting had taken place. She was asking where her husband was. By this time, it's two in the morning. Quero's wife said she hadn't seen him. Finally, Quero comes in. He's covered with blood. His wife tries to say, 'What's wrong?' And he said, 'Well, I helped a man who was hit by a car.' Quero told Leoni's now-widow, although she didn't know it: 'I left your husband about 1:00 A.M. in the main train station. I haven't seen him.' Takes off his clothes; for some reason, put his clothes in bundles, tied them up, and hid them under armchairs in the bedroom. So, he's not thinking very rationally. Goes to sleep.

Russ Roberts: He's had a tough night. The go-to-sleep part is the hard part to understand. But, okay.

Michael Munger: Just immediately goes to sleep.

Russ Roberts: Probably a little exhausted, but still.

Michael Munger: Gets up--wakes up in the morning, sees his wife staring at him. She's upset. I mean, she's not buying any of this. She knows he's very angry. He's covered with blood, and he's saying, 'I don't know.' But, apparently she also looked out the window and there was blood on the driveway leading up to the garage. So, unless he helped a man hit by a car in the garage, that seems unlikely.

So, then he says, 'Rosina, I had an argument with the professor last night and I killed him. He's down in the garage.' So, this is not something anyone wants to hear from their spouse. He gets dressed, takes some money, and drove away toward Turin.

Now so far, this is just weird. But now it takes a--well, a sort of almost comic book turn. He decided he would create--he, Quero--decided he would create a diversion contacting Leoni's widow anonymously and claim to have kidnapped him. And so, there's a kidnapping scheme: Unless we get money, we're going to kill him. And for some reason, he signed the kidnapping note: The Sardinians. As if they were from Sardinia.

And of course, he was already dead in the box. I think what he wanted was to try to divert attention: 'We don't know where he is.' 'Ah, it's because he's kidnapped.'

Problem was that the neighbors had called the police and said, 'There's blood running out of the garage.' Well before the kidnap note was delivered, the police had found the body and were starting to look for Quero. And of course, Rosina Quero, the wife, said, 'He clearly did this. He was covered with blood last night.' So, it's not even that she was ratting him out.

So, his plan was: he was going to go back to the garage, load up the boxed body into his car, and then dump it somewhere. It would have been better if he had taken it in the first place. So, the whole thing smacks of--it actually wouldn't be believable except that it's true.

So, he saw a newspaper headline--I don't know what he was doing--driving around, trying to make plans. He sees a newspaper headline saying that Leoni has been killed and was found beaten to death in his garage. Quero drives to Rome.

Russ Roberts: In Quero's garage.

Michael Munger: In Quero's garage, yes. Yes.

Quero drives to Rome; hears sounds, thinks that he's about to be captured. Drinks a significant quantity of bleach in an attempt to commit suicide--which is a pretty tough way to go. It burns your esophagus unless you--I mean, of course, you immediately throw it up. So, it's hard: it's very painful, but difficult, to commit suicide by drinking bleach. He survived that. He was arrested; he was tried and sent to prison for 24 years.

Now the reason that--as we've talked about a little bit--that these details are important is that Leoni had been an influence on three different parts of what we now think of as mainstream classical liberal scholarship. So, he was closely associated with Hayek for years, and introduced Hayek to the concept of common law as being an alternative to legislation. So, Hayek's distinction between law and legislation, in part--Hayek himself said--owes to Leoni. But Hayek also says, in his encomium at the time--the commemoration at the time of Leoni's death--that Leoni never had time to develop this. He never came up with any sort of syncretic theory of how that would work. And so, his death cut off what might have been important developments there.

Second, James Buchanan, who was developing Public Choice, credited Leoni as having identified important problems--and we can talk about that in a minute--important problems with consent and political authority, which are the main themes that Buchanan was interested in. That's what motivated him to work on that.

And then, third--and this is not as widely recognized, but I found it from Todd Zywicki, who was a professor at George Mason Law School--the law and economics movement, through George Priest, was heavily influenced by Leoni's thought; and again, was kind of cut short because there are these references that are tantalizing, but we never see the sort of full-blown theory of how he would have put--he, Leoni--would have put these things together.

And, the Mont Pelerin Society, as we've talked about, lost its president two months into his term.

So, those four things all were significant in different areas, about the quickness, the sudden unexpectedness of Leoni's death. And, I think it's just a surprising story. So, I did spend a fair amount of time trying to track it down.

21:38

Russ Roberts: And, I let you go on about it because I hear that crime podcasts do really well. So, I figured: Hey, take a chance.

Michael Munger: It's time you got some listeners.

Russ Roberts: Yeah, exactly.

I mean, I find it--you wrote it well; you speak about it well--it's just a tragic story of ego, pride, honor gone wrong, and just very sad, very tragic.

Michael Munger: Well, it makes me think of baseball players: not by the late 1960s, but in the 1940s and 1950s, many professional baseball players would also have a side job. Being a professor just didn't pay very well.

Russ Roberts: Yeah, I didn't think about that. Something paid well, though: He was driving a Mercedes and being a friend of the Olivettis' is probably helpful. He may have had other connections to them.

But, let's talk about his ideas. And let's start with the Hayekian influence. So, we've had a number of episodes on this program--long ago, but we'll link to them--about the distinction between law and legislation, that I associate with Hayek. It's fascinating that Hayek gave Leoni credit.

So, most people would say those two things are the same. Legislatures pass laws and they pass legislation. But, Hayek wanted to make that distinction. He wanted to reserve the word 'law' for, I would say, expected norms, expected modes of behavior that allow us to interact with one another without the hand of the state.

And, it comes back to our conversation, which you'll remember better than I do. Help me out here. The British--

Michael Munger: Lord Moulton.

Russ Roberts: Yeah, that's him. What was his lovely phrase?

Michael Munger: Well, he was worried about obedience to the unenforceable.

Russ Roberts: Exactly. So, that is what a law is, in Hayek's--legislation isn't usually enforced. Not always. It's sometimes poorly enforced or not enforced at all. But, when you pass legislation, violating the terms of a piece of the legislation can result in a fine, or prison, or death. A law, in Hayek's use of the word--which is now, perhaps should be attributed to Leoni--a law is a mandate that is not enforced. And, you want to live in a world--we all would long to live in a world, I think--where things are laws rather than legislation. A world that's more about law than legislation. Because, you save on the transaction costs of enforcement--which are substantial, of course. And, it means that people have embedded within their hearts, either because they have a conscience or they worry about what other people are going to think of them--à la Adam Smith--to do the right thing.

So, obedience to the unenforceable is a glorious thing. It's nice work if you can get it, if you can have it in the society. What would you like to add to that?

Michael Munger: Well, I've told this story before. I use it in class, so I'll just say it briefly; but now I would say that it's about Leoni rather than Hayek. So, imagine that we are the Board--since you're a university president, you may have been in meetings like this. We're having a meeting of the Board and we have to decide: where are we going to put the sidewalks at Leoni University? And, one thing we could do is we could have aerial photographs and we could decide these are the most likely paths that will go between the buildings. But, another thing we could do is just wait two years and then pave the muddy paths.

And, pave the muddy paths is basically Leoni's claim for how the law should work. And it's both unenforceable, but kind of self-enforcing. Paths appear, not because any individual says, 'I'd like to make a path.' They have their own plans and purposes. It's idiosyncratic. We all have different reasons. But as a result, there emerges this path between buildings.

Now, the question is: Where do the buildings come from? And, the buildings come from some sort of central plan. We don't say, 'Oh, look over there under that tree: that appears to be a group of sociologists. That's where we'll put the sociology department.'

And so the question is: What should be the line between legislation, which is the blueprint for where the buildings go. And, we have to decide that in advance because that requires the mobilization of resources and cooperation at a large scale. The transactions cost of getting that many people to cooperate--that's too high to emerge spontaneously. However, once that's done, all sorts of paths will emerge. And, if we pave those, we'll save a lot of information costs because the paths are an emergent property.

So, it seems to me that that is--a fundamental insight that Leoni has--except it goes much farther than I think anyone else that I have encountered would push it, farther than Hayek went--was that the common law is--Leoni is kind of chauvinistic and Italian about this. He calls it Roman law. And, his description of where the common law came from was a discovery process. He explicitly uses 'process of discovery,' which is what Hayek and Mises also call the process by which we learn about markets.

27:42

Russ Roberts: Talk about, before you go on: Explain to listeners what the common law is. I think that's maybe alien to some people, that phrase.

Michael Munger: Well, common law is judge-made law; and I will try to talk about it in Leoni's terms. So, his claim is that judges or lawyers or others who are in a similar position, being asked to decide things--

Russ Roberts: Disputes often, between two litigants who show up saying, 'I didn't get paid for this work.' And, the other person saying, 'The work wasn't done well,' etc.

Michael Munger: I was wondering whether to go there. And, since you raised it, let me go exactly that way.

So, let me take one step back.

Leoni is concerned about his conception of the rule of law. His idea of rule of law--and this is law, not legislation. So, we'll get to the common law in just a second. His conception of rule of law has three parts: freedom, universality, and non-arbitrariness. And, freedom-- the big part of freedom--is what Leoni calls 'law as individual claim.' And, you just nailed it. What happened is, there has to be some kind of dispute. If there's not a dispute, the law doesn't apply. We don't deal with the state; we don't deal with any kind of enforcement. We just go on with our business. There's no legislation that applies to us unless a dispute arises.

Now--and, that's a very radical idea, obviously. So, that his conception of freedom is extremely encompassing.

So, judges or lawyers only intervene if they are asked to do so by the people that are concerned. And the decision of judges is effective in regard only to the party to the dispute, not with regard to third persons.

So, his idea of the common law was that we will have disputes, and judges will render decisions, literally case by case.

Now the English [meaning, in England--Econlib Ed.] conception of the common law is that: There's a dispute, and the judge says--and here is the outcome, here is the reason, here is the principle that underlies this--the principle that is used to determine the outcome of the dispute in English common law then becomes a precedent if other judges decide to use it.

So, the question is: Do other judges find the principle elucidated by the judge in this one case to decide a whole class of analogous cases?

Because: legal reasoning is always by analogy. There's a set of facts. And, at the trial--in court--what happens is, the disputants argue about what the correct precedent is. Because if I can get the judge to accept the precedent I want to apply, I'm a clever lawyer. Of course, the precedent that I want to apply gives me the outcome that I want. And, the judge decides between these different precedents that basically have legal standing, provided that judges have, over time, found these rules to be useful for adjudicating similar disputes.

So, that all seems very complicated.

Common law, first, is judge-made law, where a decision is rendered, a principle is outlined, and if that principle is useful and general, other judges also use it. And so, it's like an emergent path. This is the way to get from this dispute to this outcome. And, all similar disputes will be resolved by a similar principle.

So, that's how the common law works in England.

31:35

Russ Roberts: Let me just say one thing about that. Common law is powerful, because no legislation can mandate and outline and describe all possible cases. So, this is just, I think, a non-obvious, until you've heard it. But then, an obvious idea. But it's radically important. So, I'm going to say it again.

You pass legislation. It places restrictions on certain behavior. It adds punishments for certain misbehavior. It might reward certain kinds of behavior with subsidies.

But you cannot outline in that piece of legislation every possible case that's going to arise, even though legislation by definition is applying to certain situations.

So, to take an example that we've used before on the program: You're buying a house. What should the condition of the house be when you leave it for the new buyer? And, there's certain language that might be in legislation. It could be in case law, in common law like you're talking about. It could be in past cases. But there's usually a vague phrase, like, it should be left in good working order, or it should be clean up to usual standards.

And by definition, those kind of phrases are not specific. They do not mandate specifically what a person has to do to comply with the law.

And, the genius of the common law is that it allows the case-by-case experience of disputants to determine what expectations are at that time and place. Which need not be the same, across cities, across countries, across time.

And the way I understand Law, Legislation, and Liberty--to the extent that I understand Hayek's book--he said, 'It's the judge's job'--it's a very alien idea, I think, for American listeners who think, 'Oh, the judge has to apply the law,' meaning the legislation.

Hayek was saying no, the judge has to apply the law, meaning his and Leoni's idea of law. That is, what's the expected behavior of a seller of a house when exiting? Is it the same? Well, the judge doesn't care whether it's the same--but what's the expectation in the area, the domain, physical domain, that this transaction took place?

And it's an extraordinary idea.

And then, you add the piece that you're talking about, which is--and then subsequent judges examine the logic that the prior judge came up with.

Michael Munger: They're helped, they are helped to examine it by the arguments brought to them by the disputant. So, it's important that it's an adversarial system--

Russ Roberts: Competition--

Michael Munger: So, the judges are presented: 'Here is the argument that you should use.' 'No, no, here is the argument that you should use.'

So, it really simplifies the decision that the judge has to make, because you have smart, articulate people saying, 'Here are the principles that have arisen from other cases that we say are like these.'

35:04

Russ Roberts: And, just to contrast it with so-called originalism--the idea that perhaps a different approach would be the judge's job is to look at the legislation and figure out what, say, Congress or the state senate or the city council meant when they passed this rule about how you have to leave your house. And it's the judge's job to figure out what they meant and impose a judgment based on that understanding.

And this is a radically different idea, and it's a fascinating different approach to how human beings should interact with one another. And, one of the reasons I love it is that instead of me trying to figure out what are the--poring over the law codes of my village, town, and state, and country, figuring out what's allowed and what's not allowed--and there are jokes about how thick those books are--I just have to understand how the world works in my neighborhood. Because I've sold houses before and I've seen my friends sell houses and a certain norm emerges of what's considered okay and what's not okay.

And of course, everybody--that's not cut and dried. You have to still interpret that. But, that's what a judge is doing, is trying to discover what reasonable people expected. And that way our plans can mesh.

What this is all about is reducing the friction of our interactions when we buy and sell things, when we bump into each other, both commercially and in other ways, to make it as seamless and low-transactional cost as possible. And, of course, Mike has a podcast, and this would be an appropriate time to mention it. Plug it Mike, please.

Michael Munger: It's called The Answer Is Transaction Costs. And, I am concerned with questions about this, like this. In some cases pretty small and in some cases much larger.

But, what's so important about what you just said and the reason that so often in The Answer Is Transaction Costs, my podcast, I take this up, is that it is the coordination of expectations that is the best way of reducing transactions costs. We all go into this expecting what actually happens, for all sorts of reasons that reduces enforcement costs. It means I don't have to change my plans. And when it's operating right, it's like a baseball umpire. Nobody notices them. The last thing you want to be if you're a baseball umpire is to be famous, because it means something bad happened.

So, the only time cases go to court--I've had a number of arguments about this with law professors. They say, 'Well, judges can decide that.' No. If the system is operating properly, there are no cases that come before a judge.

So, what you want is not to have the cases decided correctly. What you want is to have the cases decided in advance, so that there's no dispute to begin with.

And so, we've talked a little bit about common law. Let's go back to Leoni because he actually has a more radical view. His more radical view is that--and he makes an analogy and it's very explicit. So, markets are to centrally planned economies as common law is to legislation. And, a big problem that we haven't talked about so far is the knowledge problem. So, it's not incentives: it's that literally no one could possibly know what they would need to know to come up with a written law that would encompass all of the circumstances and exigencies that we're actually going to have to deal with.

Russ Roberts: And, there by written law, you mean legislation, actually.

Michael Munger: I mean legislation; although, and Todd Zywicki--I hate to give Todd Zywicki credit; it doesn't happen very often, there's twice in one podcast--but Todd has pointed out that it doesn't have to be legislation. A lot of it is rule promulgations by bureaucracies.

And so, this is the correction. This is the point at which the intervention by Leoni changed Hayek's mind.

What Hayek wanted was certainty of a certain kind; and that is, he wanted the law to be predictable. And the way to have that is to have black letter law that is written down in a book. And Leoni said, 'That's not certain. The legislature can change it tomorrow. What you need is something that emerges out of a tradition that's hard to change. That's what gives you predictability.'

And so, that's the advantage. It's not only that no one could know, but having something written down and saying, 'Well, I know exactly what these words say'--those could be changed at any time. Also, in the system that we have for adjudication, the interpretation of the law might be changed by a court. And, Leoni objected to having the content of the decision--the reasoning--have that have the force of law.

So, we pore over Supreme Court cases on the First Amendment, for example, to try to interpret what tests we will use to determine whether something is going to be unconstitutional law. Leoni didn't want that. He argued that--and again, he was proud of the Roman law contribution. He said that the Roman jurist was a sort of scientist: that the object of his research was a solution to cases that citizens submitted to him for study. So, an industrialist or a scientist might look to a physicist to engineer a technical problem. So, private Roman law was something to be described or discovered, not something to be enacted. So, over time, these principles emerge.

So, the analogy would be Newton trying to figure out gravity. Gravity works. There are certain underlying laws; and you can discover them by the application of scientific reasoning. That's what Leoni thought the common law was--was the emergence of principles that were a kind of discovery process.

And, only--this is exactly parallel to Hayek's claims and Mises' claims about discovery processes in prices. So, market processes deliver us information about the scarcity of resources through the emergence of price. For Leoni, disputes cause judges to have to think, 'Huh, I wonder, which of those arguments is closer to being correct?' And, over time we grope, through a tatonnement process, towards better, more widely applicable, and maybe simpler laws.

So, the idea that judges are going through a discovery process is something that really changed Hayek's mind; and that's where the law-versus-legislation distinction comes in. Hayek had been saying what we need is rule of law, black-letter law, written down, applies to everyone.

Russ Roberts: Legislation.

Michael Munger: Right. What he meant was legislation when he said that. You're right to correct me.

Then, he made this distinction after having talked to Leoni about, 'Well wait: the common law works differently.'

Russ Roberts: Continue. Summarize it again.

Michael Munger: Well, Leoni thinks differently in the sense that he thinks black-letter law has two problems. First, the legislature cannot have sufficient information to be able to write the correct laws, because they're writing them from scratch. Second, they're subject to change. And so, they don't satisfy his precept of certainty.

So, for those two reasons, they can't be consistent with freedom. It may be necessary sometimes to have legislation, but Leoni was pretty radical in thinking that there should be a strong presumption against having any laws whatsoever.

Russ Roberts: Legislation.

Michael Munger: And, remember, all of this comes--you're right to keep correcting me because I'm used to thinking in terms of laws. We write down laws, we have how a bill becomes a law; but legislation is something that legislatures produce. His thought was that we should not be subject to legislation and we should only encounter the law if there is a dispute between us.

So, if you and I cannot reconcile our disagreement because our expectations and behavior have not been sufficiently coordinated by the law--which is the common law--then we might need legislation. Maybe we need criminal laws to be able to say, 'You can't do this' because that could be clear. 'The speed limit is going to be 65': it's not clear that that would emerge; maybe some range of speeds would emerge, but probably not.

So, except, though, for simple things that allow--drive on the left or right? Eventually we probably could decide which of those to do. But, in a coordination game like that, just having someone move first may help. But, otherwise, in most cases, Leoni thought the law--by which he was saying legislation--should not be part of our lives unless we choose to make it part of our lives.

44:39

Russ Roberts: Okay, so let me try to clarify that a little bit. Because I'm sure for some listeners it's a little bit complicated. It's complicated for me.

So when you said--first of all, I want to take the phrase 'the rule of law.' So, usually that means--it means a few things, but one of the things it means, especially when we talk about certainty, is that there's no arbitrary, post-event consequences that I can't anticipate. That I can go about my business, make my decisions, knowing that the law will be applied to me the way it's applied to you, and to the King, and to the President, and so on. And there, by 'law,' I mean the courts, the police, and so on. It's very confusing. I apologize for that. But, that's--when we say 'the rule of law,' we mean the power of the state is not arbitrary. That's one of the most important aspects of it.

And, because of that, I can make plans. And I can do things that, if they're not illegal, I know they will come to fruition based on many things perhaps that are out of my control, but not the arbitrary power of a tyrant or a corrupt bureaucrat.

So, that's why it's important. Without what we call the 'rule of law'--usually referring to legislation in that case--it's very hard to make plans, very hard to invest, very hard to plan for the future. And, society is the lesser for it.

Now, what Leoni is arguing for is a different kind of rule of law, as I understand you're saying. He's arguing for a rule of expectations, a rule of norms, a rule of emergent understandings about how we interact with each other and--

Michael Munger: And they arise from disputes--

Russ Roberts: And they arise from disputes.

So, I want give one, I think, footnote to his understanding of that--I might be wrong. And then I want to raise a question about it.

So, the footnote is the following: You say that Leoni understood that this had problems--that legislation has problems--because what's written on the books could change. And, I don't want to follow the House and Senate in the United States or the Knesset here in Israel every day and say, 'Oh, I wonder if anything new happened?' I want to be able to go about my life, investing my time and energy into other things that are more productive and valuable.

So, that's interesting. It's a good point.

But, I'd say there's a different point to be made, which is--it's kind of, I don't know if this helps or makes it worse--but it's fascinating to me: What's written down isn't always what's enforced. This is the point about speed limits, ironically, that we've talked about on the program before. The legislation is 65. You can't go more than 65 miles an hour on a U.S. highway, say, in a particular state. But, most people know that the real--that's the legislation--the law is 67, 68, maybe 71 even, 72. 75 is speeding in a 65-mile-an-hour zone. 68, you're not going to get pulled over. It's just understood that 65 is something like a suggestion.

And I would say that any complex legislation is full of things like that where, because--not every case can be delineated--and because it can't be enforced to the letter of the law--the legislation--a set of behaviors emerge that become the, quote, "real law." What Hayek and Leoni called something more like law in their terms. Which is what people expect to be things.

And, part of what I understand Leoni to be saying, or what I'm taking from it, is that in real life--as opposed to a cartoon political science textbook, a cartoon, a caricature--things don't work out the way the legislature states them. There are numerous cases where things are not enforced according to the, quote, letter of--I'll say--of the legislation.

So, that's the first thing.

The second thing is--and this is the part where I have trouble with it, especially when you go to the extreme version of Leoni's: We don't need any legislation. We'll just let people figure stuff out.

Michael Munger: We need, we need, we need not legislation. It's not that we don't need it, we need not legislation. He will go that far.

Russ Roberts: Meaning?

Michael Munger: We should only have the law.

Russ Roberts: What people--how people behave in confrontations, disputes, and so on, or interactions.

And I want to think about--the part I have trouble with is contracts. So, contracts, like legislation, cannot be exhaustive. A contract cannot list all the contingencies of possibility, of disappointment, of malfeasance, of corruption.

Michael Munger: And, you're about to say, but legislation can? That's his point.

Russ Roberts: No, I'm not going to say that. That would be--

Michael Munger: You have literally just made his point--

Russ Roberts: That would be a foolish thing to say--

Michael Munger: Contract disputes are the source of where these disagreements come from.

Russ Roberts: Agreed.

Michael Munger: So, that's where the law comes in. We need a judge.

Russ Roberts: A judge to--then the question is--that's where I want to get to. We need a judge to do what? And in Law, Legislation, and Liberty, in Hayek's version, we need a judge to figure out what's reasonable and normative, meaning--

Michael Munger: And what was expected at the time of the contract--

Russ Roberts: Right. Exactly. And, not necessarily by the two participants--the two disputants--but by people like them in similar settings.

And, I would suggest to Leoni--and you can play Leoni here--it's not a scientist you need. You need a social scientist or a field researcher.

And, I don't know if either Leoni or Hayek had this in mind.

It's easy to say the phrase: 'A judge's job is to figure out what norms are in that area or that kind of contract and figure out what people usually expect.' And that should guide the judge to making a decision about who is correct in the dispute.

But that's a bizarro role for a person trained in legal jurisprudence. That is a job for a sociologist, or an anthropologist, to--and also a very worldly person, which most judges are maybe not so worldly.

Michael Munger: You are describing Leoni's ideal judge. There's no reason to be trained in jurisprudence.

Russ Roberts: There we go.

Michael Munger: There's no reason to memorize legislation.

Now, he may be wrong about that. But you have exactly intuited what his argument must be. You have just described what a judge should do.

So a judge's job is literally to decide what is the right outcome in this case. And, the reasoning need have no precedential[?] value for other similar cases. That will be decided by other later judges.

Russ Roberts: And, that set of decisions that later judges make--they might ignore the original decision, they might embrace it. And, as that process takes place by a number of judges, a set of expectations that were created by the--

Michael Munger: Shared, shared expectations--

Russ Roberts: by the disputants becomes codified in the cases and what we would call common law. The decisions made--that we would call common law in the English tradition--decisions made by judges, which establish precedent, rather than trying to figure out what the legislation really meant.

Michael Munger: Yep. Exactly. That's exactly right.

52:41

Russ Roberts: And this process is the exact analogy--and you're going to tell me, 'Of course it is, you idiot. Weren't you paying attention when I said this earlier?' This is the exact analogy of paving over the muddy paths.

So, the muddy paths emerge because people in their trial-and-error process--find the best ways to get between buildings and certain paths emerge. Here, the decisions of the judges are like people trying different paths between the buildings. And then, eventually after a while, so many--just like so many people have taken this path between the sociology department and the law school--so many judges have decided, 'Well, it's a person leaving a dirty house in this way, in this area. It's unreasonable.' Then everyone says, 'Yeah, of course.' And, by the way, then there's a feedback loop, which is that people start to realize it's a way for people to find out what the expectations are.

Michael Munger: And, there are no more disputes. It's settled. Ideally, that's what settled law is the absence of disputes. So, in equilibrium, there are no disputes because the path is fully paved.

Russ Roberts: Yeah. And, this is very hard for people to understand. This is sort of a different footnote. And it reminds me of what your conversations are with law professors. Would you impose a certain penalty?

I'll give you my favorite example--very appropriate for EconTalk. We probably talked about it with Walter Williams. Walter Williams, famously--and I think it's a true story; it sounds apocryphal, but I'm pretty sure it's true. On the first day of class would announce--in the cell phone era--'If anybody's cell phone goes off, the people on either side of the person's cell phone will be punished with a certain number of points taken off their grade.'

And, of course, what that meant was that--let me say it a different way. When I tell that story to people who aren't economists, they always say the same thing: 'Well, that's so unfair. I mean, you're telling me that the guy next to me, his phone goes off and I have to lose points on my grade? That's horrible.' And, I always say, well, ideally it never happened. The whole idea of it is that it's to prevent it from happening. It's to encourage people, when they sit down, to turn to the person on the left, the person on the right, 'Your cell phone off?' Yeah, yeah, yeah. Yeah, yeah, yeah. Right?

Michael Munger: I've never heard that story. That's great.

Russ Roberts: Oh, it's a fabulous story.

There's a little problem with it, of course, which is that if you don't like the people sitting on either side of you, you might leave your phone on. So, it doesn't work perfectly.

But, in a community, a place where people share multiple repeated interactions, which of course they do, this is just a way to remind folks to turn their phones off. And it's very powerful, because you get two enforcers instead of the one on just their own phone; and they're more likely to be rankled by the unfairness of it and to make sure they remember to say something.

55:49

Russ Roberts: Anyway, I think we should move on to a different topic of Leoni's if we have a good one.

Michael Munger: Well, the one that we hadn't talked about yet was, as I said, the three main themes that he was interested in were non-arbitrariness, freedom, and then universality. And, we've not talked about universality.

The version of the universality rule that is usually quoted is--well, Christians call it the Golden Rule. And that is that I should be as concerned about others as I am about myself. And, there's various versions of this. I tried to look back. Because you, a couple of times, have rightly said--in the podcast with Dan Klein, Dan quoted Adam Smith as saying, 'The great rule of Christianity is that we should love others as ourselves.' And, you said, 'Well, actually that's a Jewish rule also.'

Russ Roberts: It's Leviticus. Yeah. Sorry. But, the Golden Rule is from Jesus who said, 'Do unto others as you would have done unto you.' The Silver Rule is the Jewish version, which is Hillel's--a great rabbi--who said, 'Don't do to someone else what you wouldn't want done to you.' I think I have that right.

Michael Munger: I actually went and looked that up because I thought it was interesting to talk about. So, let's take a few minutes.

The problem of universality means that it has to apply to everyone. And, this is not the law that applies to everyone. It is that my rules for my behavior have to apply to everyone in equilibrium so that we don't have disputes. If I internalize this rule, then I end up not acting badly.

So, Thales, in 620--well, maybe 600--BCE [before the Christian Era] said, 'Avoid doing what you would blame others for doing.' So, that means you shouldn't do--

Russ Roberts: Yeah, that's the Hillel version--

Michael Munger: But, that's 2,600 years ago. That's a very long--

Russ Roberts: When did Hillel live?

Michael Munger: Plato says, 'Ideally no one should touch my property or tamper with it unless I've given him some sort of permission. And, if I am sensible, I shall treat the property of others with the same respect.'

Russ Roberts: Nice.

Michael Munger: So, Leviticus--at least the version that I had; I don't speak Hebrew--but Leviticus says, 'You shall not take vengeance or bear a grudge against your kinsfolk. Love your neighbor as yourself.'

Now the question is--what's interesting about that is: that rules out tit-for-tat. So, the Rabbi Rashi claims--

Russ Roberts: 11th century--

Michael Munger: he gives an example about revenge and grudge. So, I go and I ask you, 'Will you lend me your axe?' 'No, I'm not going to lend you the axe.' Well, I break my axe. And so, now I go to ask you--so we've reversed it--

Russ Roberts: I've gone and bought one, you didn't lend it to me. I went to Home Depot and I bought one--

Michael Munger: And, your axe is now better than mine--

Russ Roberts: Because you don't have one.

Michael Munger: And, now I want to borrow yours. And, tit-for-tat would say, 'Well, since you did not loan me yours, I won't loan you mine.'

The claim here is that you don't get to take revenge. You actually must loan your axe because that's how you want to be treated. So, the distinction is: don't treat others as they treat you. It's not an empirical question. It's: treat others as you want to be treated. And if that's the equilibrium, that's a way better world.

And so then I read several versions of Hillel, who was challenged by a Gentile who asked to be converted, but he thought it wasn't possible. So, he said to Hillel: 'You have to explain the entire Torah while standing on one foot.' And so, what he said, according to the version that I found was: 'What is hateful to you do not do to your fellow. This is the whole Torah. The rest is the explanation. Go and learn.' And, supposedly, I guess the Gentile then had committed that he was going to go through the conversion process.

So, there's a couple of places where Jesus apparently said something like this. And, I think what's interesting is that in John 13--the Gospel of John is odd. It was written 200 years after the time of Jesus. So, it's a little more out there. What John has Jesus saying is, 'A new commandment I give to you: that you love one another even as I have loved you, that you also love one another.'

So, the reason that that is a replacement for all the commandments is that if you look at each of the commandments--love one another; that is treat others as you yourself want to be treated--that would replace all of them. And so, there is a single new commandment.

So, the idea of universality means that the law has to apply to everyone equally. And, that the law is how I myself would want to be treated. It's both parts.

Hayek later went just to universality, meaning that it applies to everyone. And so, Buchanan and Congleton wrote a book, Politics by Principle, Not Interest, and they used universality to mean it applies to everyone equally.

So, one of the things that would rule out is I couldn't tax some people to subsidize others. I can tax everyone, I can subsidize everyone, but that has no net effect if I have to treat everyone equally.

Leoni would not have universality work that way. The universality would also have to embody the emergent principle of: we treat others as we ourselves would like to be treated. And so, you can't be subject to coercion because I don't want to be.

Now this is aspirational. He recognizes that it is unrealistic. But, I thought it was interesting that the appeal to universality that he makes--which Hayek later takes up: Hayek takes up a much narrower version. And that is the one that came out in Buchanan and Congleton.

So, I wanted to mention that as the third of the three principles. So: freedom, universality, and non-arbitrariness--and non-arbitrariness is what we were talking about, about the difficulty of having it changed. That's his system of law, which he thinks judges can discover over time.

That view of the common law is one that affected three different major fields. And, that I think is the reason why if you read Leoni, you'll find it rewarding. I, when I read Freedom and the Law, found myself sometimes thinking, 'Well, he's just plagiarized this from so-and-so.' Except that's reversed. This is 10, 20 years before so-and-so wrote.

Russ Roberts: Wow. So, I think we should consider doing an episode on just love your neighbor as yourself. The aspirational nature of that and how Judaism interprets that sentence from Leviticus is interesting, and how, why--even though it seems impossible--that it is an ideal to not play tit-for-tat is really a fascinating question. Right?

Your neighbor is not neighborly to you; finds himself in a bind, comes for your help. And, most people would say, 'You have every right to say no to him.' And, Jewish law says, 'Nope. No. You've got to put your grudge down, put down your desire for revenge, and treat him the way you would have wanted him to have treated you but he did not.' And, that's obviously very high level.

And, I would just add, 'love your neighbor as yourself'--one would argue, Smith would argue, most people would argue--is impossible. It's not just aspirational. You go a little stronger. Like, how could that possibly be? So, maybe we'll talk about that another time.

1:04:43

Russ Roberts: Leoni's work is--he died tragically, unexpectedly in the middle of his career. There's one book that we have in English, Freedom and the Law, that you just mentioned. Did I say that right? Freedom and the Law?

Michael Munger: Yes. Freedom and the Law.

Russ Roberts: And, are these ideas in that book, that we've been talking about?

Michael Munger: Yes, and much of it comes from quotes from this book, I would say; and I'll ask that you put up the link in show notes if you can. There's an article by Todd Zywicki--two articles by Todd Zywicki--and a couple of other thinkers that I think do a great job of explaining this. The book is written in--it's not very well-organized. It has a bunch of juicy quotes, but in terms of themes, I think it's better to read the secondary literature.

Russ Roberts: Okay. But, brave and ambitious readers could turn to--

Michael Munger: Oh, it is certainly worth reading on its own. It is like, before I see an opera, I try to read the libretto so I have an idea of what's going on. And so, having some idea what the outline of the plot would be a help.

1:05:57

Russ Roberts: Well, let's close with--here's a man who died--whose life was cut short by someone who didn't treat him as he might've treated himself. A man lost his temper--out of pride, anger, drink--we don't know. And, murdered another human being. And, his ideas were cut short. Their full ramification, their full exposition. He might have written great things.

And--but the comfort for me is that he at least was able to interact with some great thinkers who built on his ideas. So, he is still--those ideas are with us in a peculiar way. And it's nice that they're appreciated--as his--in this essay that you wrote and in our conversation. Do you want to say anything else in closing?

Michael Munger: Well, yeah. Let me close by saying, I think the single most important idea is his development of the analogy that what he views as the discovery process in law is really, really close, in analogy--is a different process, but is really close in analogy to the discovery process in markets.

And so, let me just read a little bit of quote. This is from pages 20, and then in 22, from Freedom and the Law:

No legislator would be able to establish by himself, without some kind of continuous collaboration on the part of all the people concerned, the rules governing the actual behavior of everybody in the endless relationship that each has with everybody else. No public opinion polls, no referenda, no consultations would really put legislators in a position to determine these rules, any more than a similar procedure could put the directors of a planned economy in a position to discover the total demand and supply of all commodities in service. [p. 20]
... A legal system centered on legislation resembles in its turn... a centralized economy in which all the relevant decisions are made by a handful of directors, whose knowledge of the whole situation is fatally limited and whose respect, if any, for the people's wishes is subject to that limitation. [p. 22]

So, he thinks any legislation-based system is maybe a road to tyranny, but it's going to be arbitrary. It's going to ignore what people actually need. And, he hopes that judges can be retrained in the way that you very intuitively said: You need to be a social scientist. I think Adam Smith had the same conception of the way that this should proceed--is that we should look at how things actually work. We should try to figure out what rules would coordinate our behavior in a way that's neutral, not try to use legislation to get the outcome that we ourselves want.

1:09:12

Russ Roberts: I just want to clarify one last thing before we close. At one point you said--maybe 10, 15 minutes ago--so he didn't want any legislation. So, he's a radical. But he's not an anarchist. He wants the state to have power over disputes between commercial interactions, and I assume other kinds of interactions. So, he's not an anarchist. What he's outlining--if I understand him correctly--he's outlining a power of the state to delineate expectations and norms that eventually accrete, grow, and emerge as the expectations that work best for our interactions with each other.

Michael Munger: And those should only be in circumstances where the emergence of the common law is not sufficient.

He thinks there's quite a few of those. So, when he says it would be better if there were no legislation, it's like someone who is not an anarchist that would say, 'Well, it would be better if there were no government.' But, we can't do that. That system won't work.

So, he would like to minimize but not eliminate the place of legislation, because sometimes transactions costs are just too high.

Arnold Kling has an article where he talks about Leoni's tension with collective action problems, large groups of people. So, when I said--and I would stand by it--he would like a system where there's no legislation at all. He thinks that's not possible, and that we need legislation to solve these problems.

Russ Roberts: He--

Michael Munger: He, Leoni. He, Leoni, wants a system where if you have to act quickly or there's large groups of people with collective action problems, he would grudgingly say, 'Yeah, we need legislation in that instance.'

1:11:10

Russ Roberts: So, I just want to add one last comment and let you react to it; then we'll conclude. I remember telling someone once, 'You don't really need a law against murder.' Of course, that was treated as: Obviously, I'm kidding. Of course you need a law against murder.

So, I asked the question, 'How many murders are deterred, stopped by the fact that it's illegal as opposed to, say, immoral or for a hundred other reasons people don't kill other people?' I mean, do you really think it's the legality, the illegality of murder that keeps people from harming their fellow citizens?

Now, what's fascinating to me--and we'll not go into this in depth, but we've talked about it many, many times over the years--the fact that something is not illegal does not mean it's okay. Somehow, by making it illegal--murder--people would believe, and perhaps correctly--I might be wrong, but my view--they would say, 'Well, that's part of the way we know what's right and wrong is it's illegal.'

I generally tend to lean toward preferring a world where I don't need the government to tell me what's right and wrong.

In fact, I don't want the government in that competition. I want religion and conscience and philosophy to help me do that. Not that legislature that is full of flawed human beings, not without much competition in their power to decree things.

So of course I think murder is wrong. Again--the usual example I use is drug use. I want to live in a world where people don't take drugs not because it's illegal, but because it's a less meaningful life to be drugged. And that's what deters people from using drugs.

And people say, 'Yeah, but if we don't make it illegal, people will think it's okay.'

But of course, the opposite is also true. When we make it illegal, we sometimes encourage people to take it because it's a way to rebel and to show that you are your own person and to make it hip.

So, it's these kind of questions I think are profound and complicated. And, a radical view like Leoni's I think desensitizes us to the sort of mainstream water we tend to swim in that tends to think, of course, we have to rely on government--meaning government in the legislative sense--to figure out how we should treat one another. And, I think that's not a very good system. I'd rather use other ways to figure how we treat one another.

Michael Munger: I guess what I would react to that with is my metaphor that I always use--that people may be tired of, and I've said it twice already here--rather than saying we are going to decide, maybe based on my own beliefs of morals, maybe based on opinion polls, what we'll do is see how people actually act, and from that will emerge--out of grass--a path. And that path does not result from the intentions of any individual. It's just all of the people that are pursuing their individual plans and purposes. But, the result is there's pretty clear straight path. If we pave those, then, because the path from 'I'm who I am' to not committing murder, that's pretty clear. All we have to do is pave that.

And so, the direction of causation--and in your description, and I think this is maybe the third or fourth time on EconTalk that you've used the example, and it's a good one--is it really the main reason that people don't commit murder, is it because there's a law against it?

So, if I'm going to commit murder and somebody reminds me, 'Oh, there's a law.' 'Oh, damn. That's right, I forgot.' That's not true. What happened is, that path is well-established; but we do pave it in the sense of writing down the legislation, because it is also a list of things that we believe. But, it's only the things that we believe if we already believe them. And so, saying: 'We're going to deter drug use' by writing down something that no one believes, that won't help. You have to only write down the things that people already believe if you want to pursue this program and to have an effective system of legislation

Russ Roberts: And to come full circle, legislation was not sufficient to deter Mr. Quero.

Michael Munger: Yeah, Quero. Osvaldo Quero, a person who was briefly famous in Italy for having broken the legislation.

Russ Roberts: Yeah, we don't need to bring him back, but he was not deterred by that law. But, as a result of that malfeasance, he did spend 25 years in prison. So, there's that, too. It's a whole other kettle of fish.

Michael Munger: It is sad that Bruno Leoni's life was cut short because as we've had a chance to talk about on a number of dimensions, his initial contributions were important. Hayek, in his commemoration, laments the fact that there was--he never got the chance to finish what he had started, or to explain how you might think of his different contributions as being consistent. Because it is clear that Leoni thought he had an underlying program. It is sad to think about what might have been, but it has been great to get a chance to talk about this underappreciated economist.

Russ Roberts: My guest today has been Mike Munger. Mike, thanks as always for being part of EconTalk.

Michael Munger: Thank you, Russ. It was fun.