Law versus Morality as Regulators of Conduct

Introduction

• Law and morality both influence behavior.

• Law uses sanctions for disobedience.

• Morality involves incentives like guilt/praise.

• Compares costs and effectiveness of law/morality, considering magnitude/likelihood of sanctions and informational factors.

• Examines optimal domains for each: morality alone, law and morality combined, and law alone.

• Suggests observed patterns roughly align with optimal ones.

Basic Description of Law and Morality

Law

• Rules determined/enforced by the state to regulate behavior and resolve disputes.

• Examples: fines for littering, damages for breach of contract, punishment for murder (at least ten years of imprisonment for murder).

• Establishment involves formulation and communication of rules, incurring social costs.

• Enforcement involves:

  • Identification and reporting of violations.

  • Adjudication.

  • Imposition of sanctions (monetary or imprisonment).

• Effectiveness depends on sanction magnitude and probability.

  • Sanctions can be as high as wealth or a life term.

  • Probability depends on private suits or public enforcement.

Morality

• Rules of conduct with psychological and social attributes.

• Obeying a moral rule leads to virtue, disobeying leads to guilt.

• Observers may praise good behavior and disapprove of bad behavior.

• Moral rules may vary among subgroups (e.g., abortion debate, this is tangential to the comparison of legal rules with that of moral rules, given some agreed-upon conception of social welfare).

• Establishment occurs through socialization, learning, and possibly evolutionary factors.

• Enforcement relies on internal incentives (virtue/guilt) and external incentives (praise/disapproval).

• Social costs include experiencing guilt and disapprobation.

• Effectiveness depends on the strength of moral incentives and likelihood of their application (internal incentives are certain, external depend on observation).

Law versus Morality as Regulators of Conduct

• Comparison based on social welfare, considering individual utilities.

Establishment of Rules

• Legal rules are relatively inexpensive to establish.

• Moral rules are very expensive, relying on socialization and inculcation (parents, schools, religion).

• Moral rules can also be inborn, or virtually so, establishment of the notions is essentially free from a social perspective.

• Conjecture: Legal rules have lower establishment costs, but this is only speaking of central tendencies.

Specificity and Flexibility of Rules

• Legal rules can be very specific and tailored to promote/discourage conduct at a detailed level.

• Communication/enforcement can be problematic due to information difficulties.

• Legal rules are flexible and can be changed as needed.

• Moral rules cannot be too detailed or nuanced due to:

  • Need for inculcation during childhood.

  • Limited absorption capacity.

  • Need for easy and rapid application.

  • Vulnerability to self-interested interpretation.

  • Evolutionary basis favoring simplicity.

• Moral rules are less malleable than legal rules, although general principles can have changing interpretations.

• Moral rules might have an issue with leading to errors in conduct because they aren't as flexible as adhering to legal rules.

Magnitude of Sanctions

• Legal sanctions can be monetary or imprisonment, potentially very large.

• Moral sanctions are generally weaker for most individuals in modern societies.

• Legal rules can prevent bad conduct through incapacitation (imprisonment), which is absent from moral rules.

Probability of Sanctions

• Legal sanctions are not automatic; they depend on observation, reporting, and are affected by the cost for the victim to bring suit.

• Probability of internal moral sanctions is one (excluding self-deception).

• Probability of external moral sanctions depends on context; may be higher or lower than legal sanctions.

Availability of Information for the Application of Rules

• Legal rules require information that can be difficult to acquire/verify, leading to errors and less refined rules.

• Internal moral sanctions benefit from perfect information (self-knowledge).

• External moral sanctions may face informational difficulties, but often less serious than legal system.

• A self-correcting mechanism exists in external sanctions: undeserved criticism may have less impact.

• Legal settings can sometimes acquire relevant information that observers of conduct may not have.

Costs of Enforcement

• Legal rules involve expenses of identification and adjudication, which can be substantial.

• Internal moral sanctions have no enforcement costs.

• External moral rule enforcement costs may be lower on average than legal rules.

Costs of Imposition of Sanctions

• Monetary sanctions involve administrative expense.

• Imprisonment is socially costly, creating disutility and involving administrative expense.

• Guilt is socially costly but cheaper than imprisonment; disapproval is similar.

• Virtue and praise create utility and are not costs.

Amoral Individuals

• Moral incentives may not be important to some individuals.

• This subgroup may not be small, especially in societies with weak socialization institutions.

• Amoral individuals favor legal rules over moral rules; the only effective legal sanction available to curb them may be imprisonment, as they tend to have low wealth.

Firms (and Other Organizations)

• Moral incentives may be diluted within firms due to:

  • Joint decision-making attenuating personal responsibility.

  • Establishment of firm norms offsetting usual moral incentives.

• External moral incentives have unclear force due to diffused responsibility and concealment of responsible individuals.

• Outsiders may anthropomorphize firms and impose external sanctions.

Summary

• Law and morality each have advantages.

• Law: easier establishment, flexibility, larger sanctions, important in amoral individuals and firms.

• Morality: higher likelihood of application, better information, lower enforcement/imposition costs.

The Optimal Domains of Law and Morality

• Considers three possibilities for conduct control: morality alone, both morality and law, or law alone.

• Each regime has a level of social welfare, considering costs, effectiveness, and social benefit.

Morality Alone Is Optimal

• Best when:

  • Morality functions well by itself.

  • Supplementing with law is not worthwhile.

  • Law alone is not as desirable.

• Tends to apply when:

  • Expected private gain from undesirable conduct is not too great.

  • Expected harm is not too great.

• Observed in social discourse, daily interaction (keeping engagements, avoiding nuisances).

• Theory: small private gains, sufficient moral sanctions, minor harms, high legal system costs, and many mistakes.

• Hypothetical: society is socially pathological, and the cost to apply legal rules is too high.

Morality and Law Are Optimal

• Law supplements morality when extra social benefit justifies the cost.

• Conditions:

  • Expected private gains from undesirable conduct are often large.

  • Expected harms are also often large.

• Observed in criminal acts, torts, breaches of contract, and regulatory violations.

• Theory: Substantial private benefits, inadequacy of internal and external moral sanctions to counter the private benefits, the presence of amoral subgroups, and the activity of firms.

• A notion of morality is counterproductive and legal rules are needed to channel behavior in a different, socially desirable direction.

• Imperfect deterrence by law necessitates moral control.

• Legal rules may not reflect relevant information, but moral rules can.

• Moral rules may be inexpensive supplements to legal ones.

Law Alone Is Optimal

• Best when morality doesn't function well alone and law is needed.

• Conditions:

  • Expected private gains from undesirable conduct are large.

  • Expected harms are large.

  • Law is not worth supplementing with moral rules.

• Technical legal rules often apply (capital requirements for securities sales), as well as others that might be mentioned, such as a rule mandating the use of a particular accounting convention for valuation of inventories(such as last-in-first-out), or a rule proscribing the planting of an apparently innocuous species of tree in an area.

• Theory: Large private gains, actors are often firms, substantial harm from non-compliance.

• Applying morality is impractical due to the numerousness and changing nature of rules.

• Overarching moral principle of utilitarianism is difficult to apply.

Concluding Comments

Effect of Law on Morality

• Legal rules can affect moral beliefs and sanctions, adding to the appeal of law.

Effect of Morality on Law

• Moral beliefs influence law design, such as retributivist principles in sentencing.

• The retributivist principles might affect what is the socially best domain of the law by altering the social value of use of the law.

Agreement, or Lack thereof, between Observed Use of Morality and Law

• Stresses the rough agreement between theory and observation.

• It is likely that the reader can summon to mind types of conduct that the law sanctions that would be best left to our moral system to regulate (perhaps certain types of offensive statements that can give rise to tort actions) and other types of conduct that are only immoral but ought also to be illegal (perhaps certain forms of abuse within the family).