Journal of Legal Research

Journal of Legal Research

Methodology of Institutional Law and Economics

Document Type : Original Article

Authors
Abbas Toosi 1
Mostafa Bikaran Behesht 2
1 Associate Professor, Faculty of Law and Political Sciences, Allameha Tabataba’i University, Tehran, Iran.
2 M.A in Economic Law, Faculty of Law and Political Sciences, Allameha Tabataba’i University, Tehran, Iran.
10.48300/jlr.2023.404481.2379
Abstract
Institutional Law and Economics is an interdisciplinary field of study that emphasizes the reciprocal relationship between the disciplines of law and economics. Consequently, developments within the parent disciplines, particularly economics, have exerted a significant influence upon studies conducted within this field. Each school of economic thought, through its own distinctive methodology, has affected law and economics scholarship in different manners. Although the term “Law and Economics” was not expressly employed by early institutionalists, their emphasis on the reciprocal interaction between law and economics has led to the emergence and recognition of the concept of Institutional Law and Economics within contemporary academic discourse. The notion of a “school” of thought, despite the ambiguities surrounding its precise definition, assists researchers in demonstrating that a particular approach, although situated within a broader scientific framework (here, law and economics), may nonetheless possess distinct principles and methodologies that differentiate it from other approaches, especially the mainstream Chicago School. This study seeks to answer the following question: what are the methodological foundations of the institutional approach to Law and Economics? Institutional Law and Economics, by emphasizing institutions, their temporal and spatial transformations, and the reciprocal effects of social actors’ behavior within society, seeks through an inductive and descriptive methodology to provide an empirically grounded analysis of individuals’ legal behavior within society and the functioning of institutions. The role of institutions, interactionism, and the recognition of institutional constraints upon individual choice form the principal methodological foundations of Institutional Law and Economics.
Keywords
Law and Economics
Institutional Approach
Methodology
School of Thought
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Journal of Legal Research
Volume 25, Issue 65
Spring 2026
Pages 271-292