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Quotation of the Day…

… is from Bruce Benson’s important 1989 Southern Economic Journal article, “The Spontaneous Evolution of Commercial Law”; this article is reprinted in my colleague Dan Klein’s impressive 1997 collection, Reputation: Studies in the Voluntary Elicitation of Good Conduct; the quotation is from page 167 of Dan’s book; the Hayek reference in Bruce’s quotation is to page 97 of volume 1 of Hayek’s Law, Legislation, and Liberty:

As Hayek explained, those who appear to have authority to settle issues of law need not actually determine whether certain actions have abused the will of the state, but “whether their actions have conformed to expectations which other parties have reasonably formed because they corresponded to the practices on which the every day conduct of the members of the group was based.”  Custom and practice give rise to expectations which in turn guide people’s action, so those practices that people have come to count on observing are what often are recognized as law.