Discovering Law: Hayekian Competition in Medieval Iceland
By Carrie B Kerekes and Claudia R Williamson
Griffith Law Review, Vol. 21:2 (2012)
Abstract: The general consensus is that some minimal government is needed to provide law and enforce rules. However, between 930 and 1262, the Icelandic Commonwealth functioned without a central government, relying instead on market mechanisms and private institutions. An elaborate legal system developed that guided social interaction and coordinated conflict resolution. This article utilises Hayekʼs theory of competition as a discovery process to examine the emergence of law in medieval Iceland. Founded on private property and competition, the legal structure in medieval Iceland promoted discovery of law and resulted in the relative impartiality of judgments.
From the start, Icelandic society operated with well-developed concepts of private property and law, but, in an unusual combination, it lacked most of the formal institutions of government which normally protect ownership and enforce judicial decisions.
It is commonplace to assume that private property rights and political institutions that provide law, contract enforcement, and adjudication of disputes must be established and enforced by government. The general consensus, even among defenders of free markets, is that some minimal government need exist to protect individuals’ rights and supply particular goods and services that would otherwise be underprovided by the market. However, for more than 300 years (930-1262), the Icelandic Commonwealth (or Free State) functioned in the absence of a coercive state, relying instead on market mechanisms and private institutions. An elaborate legal system developed that guided social interaction and coordinated conflict resolution.
David Friedman’s seminal article illustrates that medieval Iceland’s legal institutions developed without any central authority; hence providing the most pure example of private creation of law and its enforcement. In addition, Friedman argues, ‘the society in which they survived appears to have been in many ways an attractive one. Its citizens were, by medieval standards, free; differences in status based on rank or sex were relatively small; and its literary output in relation to its size has been compared, with some justice, to that of Athens’. This private legal system also minimized violence, rape, torture, and murder. Friedman estimates that the average number of killings during Iceland’s most violent period is similar to murder rates in the modern United States.