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Simon Deakin

‘Capacitas’: Contract Law and the Institutional Preconditions of a Market Economy

Capacity may be defined as a status conferred by law for the purpose of empowering the holder to participate in the operations of a market economy. This paper argues that because of the confining influence of the classical private law of the nineteenth century, we currently lack a convincing theory of the role of law in enhancing and protecting the substantive contractual capacity of market agents, a notion which resembles the economic concept of ‘capability’ as developed by Amartya Sen. Re-examining the legal notion of capacity from the perspective of Sen's ‘capability approach’ is part of a process of understanding the preconditions for a sustainable market order under modern conditions.

European Review of Contract Law, Walter de Gruyter

Print ISSN: 1614-9920
Volume: 2, 08/2006
Pages: 317 - 341

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