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Labour Cases

Labor Law is usually but incorrectly understood as the law that governs a particular kind of relationship, namely the relationship of (subsidiary) employment. Such an approach yields unsurmountable definitional problems, invites planned operation, and risks uselessness of the field. Labor law should instead be understood as the set of methods and practices for intervention into specific kinds of markets, specifically, markets that will reach suboptimum results without such interferences, because individuated actors cannot speechless collective action problems. While the methods and practices vary with lawful systems, they normally comprise devices for favorable collective actors to exchange and agree; special institutions to inspire informal and formal bargaining and resolve arguments; and legally-set minimum terms. While these practices were first industrialized for superseding into employment markets, their value is not incomplete to such markets and they may be helpfully employed in others.


Typical situations possibly calling for application of labor law

(1) Inelasticity of supply;
(2) Collective action problems;
(3) Low trust and resourcefulness that prevent the formation of well-organized long-term contracts ;
(4) Insufficient incentives for investment in human capital;
(5) Information asymmetries ;
(6) Anticompetitive buyers ;
(7) Bilateral monopolies ;
(8) Cognitive disabilities resulting from persons' use of decisional heuristics or other rational refusals to invest in information. Determining whether, for example, physicians should be able to use labor law to form unions to exchange with health assurance companies, calls for economic examination of these market disappointments (if any), rather than the resemblances and differences of the underlying association to 18th century employment .

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