ECONOMIC ANALYSIS IS INCREASINGLY APPLIED BEYOND ITS TRADITIONAL PRECINCTS OF THE MARKETPLACE AND THE ECONOMY
Institutions provide the framework of incentives that shape economic, political and social organization. Institutions affect economic performance by determining the transaction and transformation costs that make up the total costs of production. The clarity and transparency of any law is relevant to the transaction costs associated with using the law. The clearer and more transparent the law, the less costly it will be to use. The effectiveness of all laws hinges on an unbiased, honest judiciary and bureaucracy and on an efficient dispute resolution system. Economics provides an established approach to examine the justification and effects of the law beyond what may be possible by a conventional legal approach