The Information Costs Of Legal System

Law is a knid of social control approach and incentive mechanism by government's implementation as the third party. The effectiveness of the legal system mainly depends on the fact that whether it can set appropriate legal responsibilities to different "harmful" behavior accurately and implement precisely, ie. the accuracy of control. To improve the accuracy of legal control contributes to a better deterrence to harmful behaviors, avoids the error deterrence to attainable behaviors, and also reduces the unproductive law enforcement's costs which even may bring in loss. The accurate operation of the legal system must obtain sufficient informationas as the premise, but the information is never free. Therefore, the pursuit of the accuracy to social control will subject to information costs, and the information costs will also become the key variable to decide the effectiveness of legal system.This paper aims to apply the approach of economic analysis to study the accuracy of legal control, thereby to determine the information costs of the effectiveness of legal system, simultaneously to see about the relevant legal system through this key variable, ie. information costs and to discuss the dominant logic they hide. The loss which is caused by the deficiency of accuracy of legal control can be called error loss. As a kind of social control mechanism, legal system's ultimate purpose is to improve social welfare by enhancing behavior. Therefore, the ideal legal system should seek the equilibrium between the error loss of legal control and the information costs, ie. the minimum of summation of the both. At this time, the net profit of legal control can get maximization. To better response to specific information environment so as to much closer to the institutional arrangements of the equilibrium point is the most efficient one.The first step of legal operation needs to establish inclusive and deterrent appropriate legal orders. This requires that law makes proper "typology" to objects's adjustment and set the corresponding legal responsibility. The simple rule of ignoring more differences and considering fewer factors could help to save information costs, but it could bring greater error loss for social control. The complex rule that is distinguished more detailedly could enhance the accuracy, but usually also increase the information costs. Another form of legal order——"standard" is helpful for judges to obtain a higher accuracy, but it usually also means the higher information costs, the uncertainty and the risks of abuse of rights, especially in the countries with underdeveloped rule of law. The rule and standard have different advantages and suit to different areas respectively. Their cost-benefit is closely related to the judicial environment. What we usually discuss that the legislation "should crude" or "should complex" is the issues of the precision of the rules and standards and information costs in essence. This issue should be based on the specific conditions of China in different fields to find an efficient combination of rule and standard. The important function of due process is to increase information supply, reduce information requirements and to reduce public-to-government's decision-making monitoring costs. It may be difficult for people to make judgments for the governmental substantive decision-making, but people can easily validate whether the government have violated the procedure. The due procedure makes substantive questions arbitration through rigorous formalistic "procedural" rules, and it helps to improve the comprehensive management's profit of rule and standard.After created, law must be able to implement accurately, otherwise the control purpose of the law can not be achieved. Improving judicial accuracy, reducing error penalty and error acquittal are able to enhance the level of legal deterrence and obtain the better control effect, but also subject to information costs of discovery and checking fact. The accuracy is estimated by the ratio:the probability of criminals who are convicted and of innocent people who are wrongly convicted. In fact, the accuracy of the legal enforcement and information costs are closely related with justifiable approach, proof standard and proof procedure.These basic judicial systems influence the judicial accuracy and cost from different dimensions; in turn, their different forms and vicissitudes are also determined by diferent environments of information costs, and they are the responses for the system to changeable information costs. "Ordeal" is one judicial proof method under the environment of a low level of awareness, information technology backwardness and highly information cost. Relying on a series of institutional and technical arrangements, "ordeal" reduces or replaces the information needs. It is the production to adapt to the prevailing circumstances, and is the result to make balance between seeking social control's accuracy and controlling cost. In ancient society, highly formalized and even mechanical substantive laws and procedural laws were an inevitable response to highly information costs at that time. From the "ordeal" to "sub", from "the informed jury" to the modern jury and from the "legal evidence" to "discretion", these changes reflect that the judicial systems vary along with different information costs. Under the invariable condition to information, the fact that the improvement of justifiable standard means increased information costs the single case needs is helpful to reduce probability that the innocent people are wrongly punished. But if the justical input keeps invariable amount, the probability that the real guilty person is wrongly acquitted may be increased so that the cost of different dimensions must be taken into consideration in adjusting justifiable standard. While information cost is greatly reduced, even though the justical input keeps invariable amount, the appropriate increased justifiable standard not only will reduce the probability that the innocent people are wrongly convicted, but also will not even will reduce the probability that the real guilty person is wrongly acquitted. At this time, it is efficient to improve justifiable standard. The best justifiable standard is closely related with the level of information costs. The justifiable procedure also influences the probability of wrongful punishenment and of wrongful acquittal simultaneously, and it is closely related with the information costs. Due process must seek balance between the accuracy improvement and the information costs, rather than a single increased protection intensity to the innocent.In the legal level, the implementation will meet the legal vagueness, conflicts, gaps and the situations of serious departure from the viewpoints of social justice, and so on. This refers to the issues of legal interpretation, supplement and continued making in complicated cases. Different interpretative methods means different information costss and accuracy. The judgment of formalism tendency is helpful not only to save judge's referee cost, to obtain authoritative and persuasion of the adjudication, but also to improve legal certainty, and reduces the cost of people's obedience, obstacles to reconciliation, and the monitoring costs to judges. That is why the formalism becomes the orthodox judicial ideology and could be also expected by society. However, in difficult cases, the formalized judgments will result in loss of substantial justice, and then two kinds of cost's balanced questions will be confronted. The stronger formalized textualism interpretation and the stronger deliberate contextualism interpretation reflect the concerns for different costs. The judge will first attempt to choose interpretation approaches of fewer information cost to solve the case. In order to reduce the cost to convince (namely information costs), the judicial process is full of rhetoric. Ruling from the law is the most effective rhetoric; therefore a judge even in "law" has to put on the coat of "interpretation". Of course, this is a restriction law against the rhetoric. What is more helpful for judges' decision is the social scientific knowledge rather than a moral theory. But moral discourse is often more rhetorical color, so even though we advocate that in difficult cases, consequential balance should be guided by social science, but we still approved the rhetorical strategy of moral discourse.Whether to consider the subjective intentions of behavior subject has a significant effect on the information costs of legal operation. The reason is that the the observation and verification cost of the subjective intent is extremely high, and even some of the information may not be obtained by other people except behavior subject. This refers to negligence liability and strict liability. In the infringement system, both of them are committed to making the sum of administrative cost in accident prevention costs, casualty loss and system operation to a minimum. Information costs determines their ability to meet targets and cost. The reason of negligence standard's objectification lies in saving the information costs. The negligence liability subjects to the information costs of confirming negligence. And the strict liability subjects to the information costs of assessing and forecasting accident loss.The comparative advantages of systems lies on the information cost that their operation needs and the ability that they guide behavior subject to effectively exert private information under different circumstancesAll laws can be regarded as a kind of "deed (contract)" in some sense; in turn, the contract also can be regarded as a kind of "law" between special subjects in some sense. Therefore, the problem found in the discussion to the system of contract often extends to the whole legal system. In addition to law, the contract has other enforcement mechanisms, and different enforcement mechanisms have different information needs and information capabilities. Actually, the law itself also exists implementing body and method beside the government. A key function of the contract law is to provide easy observation, verification of contract programs, to reduce acceptable cost that the court confirms whether the litigant receives legal restriction voluntarily, and to reduce the wrong compulsion. Contract law also provides a large number of implicit clauses which are useful for the conclusion of contract and for the judges' interpretation and supplement to contract, reduces the transaction costs and judicial cost, and improves the predictability of judgments. The judges' incomplete contract's supplement capability is limited, therefore strictly following the text of the contract will help reduce the referee costs, reduce errors supplement, prevent the abuse of power of judges, and urge the litigant to write in a more complete contract. As a result of the information costs and the judicial ability's limit, the relational contract's inspiration may not be more free supplement contract for judge, but reconsider other enforcement mechanisms which are different from law in information needs, and be more respectful to contract freedom and contract text in judicature. To some extent, these conclusions can also be applied to the operation of law itself.The competition between the different social control mechanisms largely depends on their ability to deal with the information costs. As "the king of philosophy", the greatest barrier of Plato's "Republic" lies in highly information costs. Law is the rule of provisions. Relying on the general rule and the "typological" resolution to similar issues by similar treatment, what the legal superiority rests with reduces highly information costs needed by "concrete analysis of concrete conditions". Of course, owing to neglecting infinite difference for modulating objects, it results in the loss in social control's accuracy. The law should pursue for the balance between the two situations. The formal virtues of the rule of law required "good law" is to reduce information costs in essence, and information costs offers a valid reference for understanding and explaining these formal virtues. The success of the rule of law is an effective response to the information issues not only of the government controlling society, but also of the society controlling government. The significance of freedom is the ability to effectively produce and utilize the scattered existing knowledge and information. In most cases, the fact that the government doesn't have much more informational advantage is an important economic reason of limited government. The best boundary of government control relies on the balance between the controls of income and of cost. What is hidden in the controversy between "rule of man" and "rule of law" is still the balanced economic logic between the accuracy of social control and information costs.Hereupon, information costs is not only a object for study, but also a new research perspective. It can help us to understand lots of complex terms and theories, to face the nature of things, and to provide clear, concise and rich explanatory accounts for many questions. Then, it can offer a simple and explanatory theories or perspectives for legal reseraches. At the same time, the research conclusions achieved from this paper also establish important normative meanings to Chinese system transformation and legal construction.