ORIGINAL ARTICLE
ALFREDO, Benjamim [2]
ALFREDO, Benjamim. Economic Laws: Normative or Enunciative?. Revista Científica Multidisciplinar Núcleo do Conhecimento. Year. 07, Ed. 11, Vol. 01, pp. 134-152. November 2022. ISSN: 2448-0959, Acess link: https://www.nucleodoconhecimento.com.br/law/economic-laws
ABSTRACT
In the study of political economy, when we talk about economic laws, some doubts arise, specifically about whether they are or are not true legal norms, given their objective nature. In using the expression “economic laws,” their application in regulating economic activity, as well as in the relations that the State establishes with other economic agents, are subjects that concern scholars in the social sciences. Economic laws are characterized by economic theories and doctrines that, according to economists, contribute to the realization of economic activity. Because the concept of law, as a command and immediate source of the formation and revelation of law, differs from the concept of law in political economy, as it involves an enunciation of economic theories and doctrines that, while useful from a scientific point of view, are not a source of law and not even obligatory compliance. Therefore, the questioning of the true meaning and legal validity of the law in political economy is a fundamental reason for this study, which aims to contribute to the reflection and clarification of the said designation in the study of the discipline of political economy, as well as in legal science and its general application. The method used for this study consisted of collecting bibliographic information, legal foundations, and the technical and academic knowledge that the author possesses on the subject.
Keywords: Economic laws, Enunciative laws, Normative laws, Political economy, Legal norm.
1. INTRODUCTION
In the study of the subject of political economy, which encompasses social relations of production, distribution, and consumption, as well as the significant causal connections and interdependencies that arise, the nature of the development of various theories, opinions, and doctrines labeled by economists as economic laws becomes apparent. Political economy, as a social science, explores both the objective and subjective economic relations—the economic activity itself and the relationships established among economic agents in various scenarios. These relationships are governed by various laws, commonly referred to as economic laws, yet without clear justification. However, there is a broad spectrum of interconnections between economics and law when discussing economic laws. The term “economic laws” may imply normative regulations governing the behavior, actions, and relationships among economic agents in the realm of economic activities. Alternatively, it may suggest the enunciation of theories, doctrines, or rules resulting from studies related to economic matters, aiming to contribute to the realization of economic activities based on scientific knowledge within a specific historical period of societal life. Etymologically, the word “economy” stems from two Greek words, OIKO = house, and NOMOS = norm or law, together signifying the administration or governance of the household, considering the management of scarce resources in ancient Greek society. Nevertheless, the concept of law becomes truly understandable when distinguishing between law in a formal sense and law in a material sense. While the former refers to normative acts emanating from a body with legislative competence, whether or not containing a true general rule, the latter pertains to normative acts issued by a state body, even if not endowed with legislative functions, as long as it contains a genuine general rule. This distinction highlights a matter of political nature intricately connected to legislative functions. However, in both senses, we encounter a legislative act rather than a theory or doctrine that could substantiate the validity of the normative act par excellence, as implied in the term economic laws. It should be noted that not all rules or norms are legal. Interestingly, law does not solely consist of regulations but also encompasses decisions, acts, and theories. Acts of administration, for instance, are legal but not normative, much like judicial sentences and the doctrines of legal scholars. However, in the legal sense, the law is a specific subject of legal science. Despite differing opinions, the concept of economic laws likely gained prominence due to beliefs propagated by medieval philosophers and thinkers, linking these laws to natural and material laws. While political economy is not a normative science per se, it relies on concepts, theories, and doctrines that, in turn, give rise to rules and theorems termed by economists as economic laws. However, these laws do not equate to legal laws, as previously mentioned. According to economic thinkers, economic laws are aprioristic—they do not need prior verification or falsification as they are inherently true. They can be expressed mathematically and empirically verified but not falsified. We argue that there is a distinction between laws produced based on economic science and laws in the true legal sense, with the latter characterized by generality, obligatoriness, and coerciveness, requiring careful definition and application. Laws are made by humans and for humans, not humans for laws. This argument, as further discussed, does not exhaust the reflection on the necessity of discussing economic laws, opening the door for critical reflection and debate on the subject at hand: whether economic laws are true laws, quasi-laws, optional laws, or even laws of economics—a matter of great interest for scholars in the social sciences, particularly economists and jurists.
2. BROAD PERSPECTIVE ON ECONOMIC LAWS
The notion of economic law emerged with the Greek philosopher Aristotle, who lived in the 4th century BCE. In his book titled “Rhetoric,” he presents the idea that economic activity is developed based on divine or natural laws, and these laws are economic, hence not subject to questioning by humans. According to Aristotle, natural law is so perfect and eternal because it translates divine will, making it unquestionable and unalterable by humans. This law is valid for everyone, across time and space. Aristotle’s perspective, advocating submission to divine will, prevailed in his time, despite efforts by many philosophers to overturn it with scientific reasoning. Despite contrasting views suggesting that economic laws result from the observation of various studied phenomena, allowing the production of hypotheses, propositions, and models related to the production, exchange, and consumption of goods, Aristotle’s position persisted. Today, it is common to speak of economic laws resulting from a natural and divine process of human development, enunciating economic thought and aiming to bind society within economic activity. However, the evolution of economic and social life demonstrated that these laws could indeed be modified by humans in response to changes in production and consumption conditions. There exists a causal interdependence between production relations and the level of development of productive forces and social needs at a given moment, determining the formation of a new economic thought aimed at improving economic and social needs. Just as with the development of social relations, laws created by humans to regulate their social life also emerged. These ideas help understand subjective idealistic conceptions that point to human will in the development of laws governing social life. Over time, humans, living alongside others of their kind, established various relationships, not always peaceful, leading to conflicts and the creation of norms to discipline and regulate social life. To regulate life in society, humans created norms of social conduct. Initially, before the discovery of writing, these norms were formulated orally and transmitted from ancestors to descendants through generations. Later, with the advent of writing, norms became written for universal understanding. Among social conduct norms, humans created moral, ethical, and courtesy norms, compliance with which is optional, and non-compliance does not entail punishment. Contrary to these, the natural laws mentioned earlier were based on reason and logic, measurable in terms of what actually happened, how it happened, and why it happened, allowing the enunciation of theorems and doctrines by medieval thinkers and philosophers. However, these positions can be questionable, considering that the creation of such laws cannot be divorced from human will. Humans observe phenomena, study them, and produce theories that govern economic activity. In fact, the question of the objective nature of economic laws, advocated by various authors, does not exclude human will. It is increasingly clear today that humans develop most of these laws, which change over time whenever a certain adverse or favorable situation occurs for economic activity. Humans are at the core of these economic laws, even though they cannot impose their will regarding compliance with these laws. As mentioned earlier, economic laws enunciate theories and doctrines, unlike legal laws, or juridical norms, which emanate from a competent and authoritative body, requiring obligatory compliance from everyone. In case of non-compliance, a sanction is foreseen. As stated, political economy uses economic laws in the treatment of economic phenomena, defining itself as a science that studies economic phenomena in the production, exchange, and consumption of scarce material goods and vital services in human society, along with the laws regulating relations between various economic agents throughout the economic process. In conclusion, economic laws enunciate economic theories and doctrines in the true sense and objective nature of political economy. However, a question arises: what laws are these, after all? Assuming that economic and social development is a natural historical process through which humanity strives to achieve full production and productivity, harmoniously meeting its increasingly urgent needs in consideration of the scarcity of available resources, laws are produced for this purpose. These properly formulated laws constitute a coherent economic legal system aiming at social order, enabling society to carry out its economic activity harmoniously. In a generalized sense, the term “economic laws” falls within the scope of political economy. Economics and political economy manuals limit themselves to discussing the objective nature of economic laws and briefly present their typology, but they do not delve into the didactic issues that such an expression raises. We understand that the subject does not seem to interest its development, treating it as a matter that appears to be settled when, in fact, it raises questions that may be relevant to the criteria of truth and social practice. We believe that the expression “economic laws” is historical but lacks the development of its real sense, given the current context, regarding the true meaning of economic laws. We understand that the term “law” falls within the study of legal science and, therefore, cannot be used in economic science uniquely. We believe that its repeated use over time and its acceptance by practitioners of economic and legal sciences reveal a strong conviction that it refers to the same concept of law, and thus, its true meaning and usage in economics have not been questioned. For example, market laws formulated in the early 19th century by French economist Jean Baptiste Say and the law of diminishing returns referenced by Samuelson and Nordhaus (1988), just to name a few, are theoretical principles of economics enunciating guiding rules for economic activity. These are true theorems that economists use to formulate and substantiate their economic studies and technical opinions. Such laws are referenced in various studies aiming to formulate different state economic plans. The theories of Adam Smith, for instance, are based on the assumption of a natural order, presupposing the existence of economic laws imposed by nature. It is the role of economists to discover, formulate, and disseminate these laws, with Adam Smith emphasizing the essential role of humans in formulating or modifying such laws. However, it’s crucial to note that Smith did not intend to promulgate a specific opinion on the validity of these laws but rather to emphasize the need to be aware of their existence in the treatment of economic matters. In this case, understanding the fundamental role of humans in relation to the formulation or modification of such laws is considered critical. Quesnay, as referenced by Valier (2016), developed the theory of political economy based on the natural sciences, asserting that economic laws are natural and universal and should, therefore, be respected and followed. However, Valier (2016) criticized Quesnay’s position for not realizing that these economic laws are historical and specific to a historically determined economic and social system. Valier (2016) also noted that Quesnay’s immediate successors, the classical thinkers, also failed to understand this, continuing to defend the existence of economic laws that, being divine, should be scrupulously respected. This supports the position that these economic laws are enunciative and not normative in the legal sense because they undergo constant mutations and do not depend on the state legislative power. Charles Fourier, a proponent of utopian socialism referenced by Valier (2016), brought a different view and a new idea regarding the belief of classical economists in natural laws. Fourier challenged the notion that these laws are valid at any time and place, asserting that economic and social systems can be very different, and economic laws are historically determined. Fourier’s position is grounded in the mutations of production forms that evolved over time, allowing for distinct phases, such as the changes in currency forms in Europe in the late 18th century. The various mutations in human life on Earth, the evolution of production and appropriation of scarce resources, contribute to new theoretical realities, as well as changes in human behavior and the environment in which they live. These factors contribute to mutations in economic theories and doctrines. In this context, according to Fourier, a fundamental law governing relations between humans emerges at a certain moment, triggering a law of attraction that, according to Fourier, governs the universe. While Fourier’s thought is not extensively developed, it essentially supports the position that economic laws are only valid at a specific moment and are subject to mutations that occur in human life, space, and time. With this, we do not intend to dispute the existence of such natural and universal laws that do not depend on humans. We agree that human life triggers changes in the generation and appropriation of resources, increasingly scarce in the universe. However, natural laws also undergo mutations, considering human behavior in the face of economic activity, and they do not address the concerns that humans face in their daily lives. Even economic laws whose theories and doctrines govern value, income distribution, economic growth, along with various environmental crises and climate changes the world faces over time and space, though having a historical character, do not solve all the problems that humans encounter. Therefore, natural laws and the so-called immutable economic laws, being specific and mutable, also take into account the particular way society is organized and the behavior of people in society. Hence, the existence of economic laws, originating from economic thinkers and understood as enunciative, and normative laws, originating from legislative bodies and regulating people in society. The scarcity of debate about economic laws, whether normative or not, cannot imply acceptance and acknowledgment that such laws are true legal norms. We believe that the question of whether economic theories and doctrines, dealing with “what is” and “what ought to be,” can or cannot raise controversial issues needs to be discussed. Such discussions may cast doubt on the sense these theories lend to so-called economic laws since they formulate principles that do not align with the principles of law, especially regarding their validity as true legal norms. Principles, theories, or economic doctrines are not legal norms; therefore, they cannot be laws. They lack a legal command that gives them validity as legal norms. Additionally, it is essential to consider that in law, words have their own meanings, and legal science has principles that shape its object and method. In law, definitions can be perilous when not properly formulated and may undermine the scientific phenomenon of the discipline, which relies on a solid foundation of facts, acts, specific formalities, and supporting principles. The systematization, rules, and norms resulting from anticipation and enactment in the face of a concrete fact of real life constitute the fundamental basis for creating a law and, in turn, its primary source. Law does not regulate every situation in real life; it leaves that task to other areas of scientific knowledge, considering the molds of social life. Moreover, law is for society, and without law, society cannot live in harmony. The creation of laws is a matter of human beings. Law thrives on its sources, and the law is its primary source par excellence. Each law is a system of norms expressing the will of society, determined by various social factors. Among them, the most important are the material conditions of social life, how scarce resources are generated and appropriated. Thus, the development of economic activity triggers economic legal norms regulating the production, exchange, and consumption of goods and services. The formation of economic legal norms has consequences. Economic factors, to be regulated by law, must take the form of legal motives and pass through social consciousness. Laws arise from the acts of the State and competent bodies for this purpose. However, these acts are always conditioned by the underlying economic relations, the legal consciousness of society, and the balance of power among various economic agents. The social force that triggers the creation of laws governing economic activity is not just one link in the chain of factors determining the content and form of legal-economic norms. All social factors (economic, political, ideological) determine the essence and content of economic legal norms created directly by the acts of state power. However, when the concept of such laws is invoked, several aspects arise that cast doubt on whether these economic laws are indeed produced by economic thinkers or by state powers. This question arises because the meaning of the law embodies a general and abstract command of obligatory compliance, resulting from a relationship between a fact and the need for its regulation in the social realm. Only the legislative body has the authority to create economic law in the sense of regulating economic acts and the subjects engaging in economic activity. However, the legislator does not produce, let alone articulate, economic theories, opinions, or doctrines. It produces economic law in the normative sense. The term “law” contains various meanings and metamorphoses of other terms in legal vocabulary. Let us consider some illustrative facts to show some underlying aspects in relation to our theme. An economic situation, fact, or economic phenomenon may prompt a certain regulation. For this purpose, the task will fall to a legislative body with competence. Can a law designated as an economic law be created in this context? Does this law also consist of an anticipation integrated by the abstract characterization of the situation, the concrete fact to which it refers, and its enactment, by stating the legal effects triggered by the verified concrete situation as anticipated? We understand that yes, as the facts or economic phenomena, although social, aim at economic activity, which, in turn, involves production, distribution, and consumption, as well as the relationships established among various economic agents with the aim of well-being. Contrarily, we do not agree that a law referring to economic principles, theories, and doctrines should be considered an economic law in the normative sense, but rather in the enunciative sense. Our position is supported by the fact that such a law aims to apply a scientific method to practice, namely, the process of observation, hypothesis establishment, testing, and interpretation and synthesis through logical processes that, though mutable, contribute to the evolution of economic science and assist economic agents in carrying out their activities. These are only probable elements and not exact. A normative law does not operate with variables but rather on the basis of certainty regarding the concrete fact it intends to regulate. One could talk about theorems solely to compare them with economic theories or principles, which allow for the application of variables in analyzing a particular economic situation. Martínez (1990) argues that the term “law” is used with two different meanings, although there is an admissible unity of origin, a common rationale. He adds that, by law, one understands a necessary or at least probable relationship between a antecedent and a consequent, a relationship that corresponds to a natural ordering of life. According to Martínez, the law can also be understood as a command that a society imposes on its members. The law reduces social antagonisms and allows for a peaceful and harmonious life. This hidden reality constitutes a significant aspect: the relationship between legal science and economic science, that is, a relationship of dependence of the latter on the former. Although we agree with Martínez’s position, the production of legislative rules is necessarily linked to all other productions of norms that society brings about, such as the law of production of economic goods, for example. However, in the legal sense, the term “law” has various meanings. It can be synonymous with right, in this case, in a normative sense, identifying with the authority of the State or even with the legal system. The law can also be considered a source of law, the form of creation and revelation of law. However, the legal sense of law is what is stated in Article 1, paragraph 2, of the Mozambican Civil Code (PORTUGAL, 1966), which encompasses only generic provisions from competent state organs, leaving aside all general normative acts of a privatistic nature. We lean toward this legal sense because it causes less confusion or difficulty in conceptual understanding. So, where would the economic law fit into the senses mentioned above? It is not an easy task to frame the concept that can best adapt. In fact, determining whether economic law is a true law from a legal standpoint has never been the subject of a critical scientific approach, and it is now relevant for clarification and rational discussion. Manuals of political economy, at best, present the characterization of so-called economic laws but do not provide the exact concept and notion of what an economic law is in its essence. However, critical thought on the matter cannot be content to only describe the fact but rather a theory that can contribute to a scientific technical reflection on the legal validity of these so-called economic laws. Critical theory allows not only the discovery of the different hidden aspects of a reality that is raised but above all opens the doors to a new dimension, that of understanding whether economic laws are true laws or not. Hence, the reason to question the designation of economic laws, whether they are true laws in the legal sense, a matter that, due to its relevance, aims to promote debate and a new scientific perspective for reflection and clarification of the true meaning of such laws.
3. ECONOMIC LAWS FROM THE PERSPECTIVE OF POLITICAL ECONOMY
Jurists have always been interested in political economy; however, they have never dared to provide definitions on matters that interfere with the science of law. Economic laws have never been a subject of dispute in their definition. Jurists argue that legal-economic norms aim to regulate aspects of the process of production and appropriation of scarce resources, emerging conflicts, the planning of economic activity, and the relationships established between economic agents for the social well-being. Referring to them as economic laws or laws of economics has never been a matter of discord or served as a basis for questioning their validity as norms regulating aspects related to the production, exchange, and consumption of goods and services. In fact, various economic laws are referenced in different economics and political economy manuals. According to Martínez (1990), among the various economic laws, notable ones include the law of competition, the law of least effort or the hedonistic principle, the law of population, the law of supply and demand, the law of production cost, and the law of diminishing utility. These examples of economic laws raise doubts and curiosity regarding their validity as laws in the juridical sense. A careful reading might lead us to designate such laws as resulting from economic principles, theories, and doctrines; however, no legal command is discerned in them. The designation of economic laws related, for example, to the regulation of matters concerning economic activity can lead to the conclusion that they are laws in the juridical sense, as they are imbued with a legal command. However, the position regarding certain laws is not clear, as, for example, the law of production cost, according to which the prices of goods tend to coincide with their costs (MARTÍNEZ, 1990). Where does the command lie in this law? Although the aforementioned law intends to refer to the theory that the price of goods tends to coincide with their cost, in the sense that the economic agent must consider the cost in the respective price when producing a certain good, it does not obligate the economic agent to its strict compliance. Instead, it enunciates a theory that can help the economic agent if they intend to carry out a specific productive activity. This theory can be useful for the economic agent, as no one would be interested in producing a good at a certain cost and selling it below that cost. Certainly, they would lose money. However, there is no command here, only a theory that recommends what the economic agent might, if they wish, do and would not be sanctioned if they do not. Another example is the law of diminishing utility, according to which, the more consumption of a good occurs, there is a tendency to attribute less utility to that same good. There is no legal command in this law; instead, it is a theory that can help both in production and in the choice of a particular good and its consumption. On the contrary, a different understanding can be derived concerning the competition law and monetary law, given their objective characteristics. The first, because it aims to regulate the rules of the market concerning its operation, harmony, and safeguarding other related aspects of supply and demand. The competition law. This law can be understood as a command and as a normative law when the State decides to impose a regime of economic competition. In fact, economic agents seek, in the market, ways to achieve their aspirations. Some sell (offering goods and services), and others buy (demanding goods and services). Naturally, in this process, both negotiate the best price for the best good or service. It is understandable that this is the way economic agents operate in a free economy, where market laws define the rules they should follow. However, competition must be regulated as a way to safeguard and harmonize market interests (DURAND, 1961; FONTAINE, 1967). The right to competition is discussed today, and it is noteworthy that classical unfair competition law, which has become doctrine, is related to subjective elements linked to the behavior of participants in the market and their mutual relations; it only prohibits practices contrary to fair trade practices. Modern competition law, on the contrary, is much more concerned with establishing and safeguarding certain objective market conditions. Therefore, competition is considered an object of law, deserving protection because it enables achieving certain purposes, whether it is price stability, employment plans, or accelerated growth. Thus, in a subjective conception of competition, parallel imports, a zone granted to an exclusive distributor, are considered acts of unfair competition. In contrast, current competition law believes that the possibility of parallel imports should be preserved to safeguard the competitive order it seeks to establish. Therefore, the current perspective of competition law tends to change, moving from subjective relationships between economic agents to an objectively regulated order of economic activity. The second, because it aims to regulate matters related to currency, its creation, circulation, and use. Now, these two laws can indeed constitute normative laws, given the underlying command in them.
4. ECONOMIC LAWS OR LAWS OF ECONOMICS?
The assertions and arguments surrounding the expression “economic laws” in the field of political economy suggest questions that could certainly trigger various reflections on the subject. As it is a controversial topic, some scholars may assert that there is no doubt or dispute regarding the expression in question, as there is no etymological conflict, and because the term “economic law” refers to the laws that materialize scientific theories and doctrines about economic activity. In contrast, for example, to the laws of physics and chemistry, which, being considered divine and universal, must be observed by all, even though they are not altered without the observance of tests and experiments. According to Marshall (1990), the father of neoclassical economics, “political economy rarely answers any social question, just as any social question rarely can receive answers independently of political economy.” However, economics does not rely on experiments and experiences conducted under artificial conditions in laboratories, where the researcher disregards the phenomena that complicate the analysis of the process in its purest form. Economics lacks the possibility of conducting rigorous experiments on the formulated hypotheses, but it can confront them with facts using historical knowledge or specific statistical information. Given that economics, like other social sciences, faces difficulties in proposing exact solutions due to the constant changes occurring in society, considering the practical problems that arise within it. Economic science seeks to formulate laws, that is, to provide theoretical and doctrinal explanations, aiming to support the production and reproduction of phenomena it has analyzed under certain conditions. However, it is not about formulating true laws that will regulate social life but rather economic life. Therefore, the indiscriminate use of the expression “economic laws” that may be confused with economic theories and doctrines and the term “law” as economic legal command that aims to regulate relations between the state and economic agents and instruments related to economic plans and programs is unwarranted. I argue that economic laws must reflect their true meaning, and I disagree with the position that they encompass and bind the entire economic reality. We advocate the existence of economic laws representing theories and economic doctrines developed by scholars in the investigative process and translating into a result that may or may not be adopted by society. They are enunciative laws and not normative. However, there are also economic laws that result from human will and emanate from competent bodies for their production and application, and such laws are intended to regulate economic activity and the relations established between economic agents. Given their characteristics, they bind their recipients regarding compliance. It is important to note that this position does not enjoy consensus, as can be seen below.
The economic laws, according to proponents of neutral or mechanistic theses, are important because society cannot develop without them (MARTÍNEZ, 1990). However, there is an acknowledgment that economic laws are not very rigorous, and this is due to the nature of the object of political economy, unlike the exact sciences (mathematics, physics, chemistry, and others), whose laws produce better results due to their rigorous form and the way they are interpreted and applied. Now, this conceptual position can, however, be challenged if we turn to Heisenberg (1981), who argues that “existing scientific concepts always spread only over a limited part of reality, while the other part that has not been understood is, so to speak, infinite,” considering this infinity much greater in economics. Now, it is not enough to defend the existence of scientifically well-formulated economic laws; they must signify a certain factual truth over time. However, economic laws, or “almost laws,” as they are also called because they are less rigorous, are not always adhered to, but they allow economic activity to take place. However, as we have been arguing, they are enunciative and not normative. This formulation intends to convey that economic laws, by their formulation, do not allow for strict compliance, and, for that reason, they are not binding, leaving compliance to the discretion of each individual. Now, a law is a norm of a general nature, defined by the mandate of the competent authority and established to enforce it. It must be obeyed by everyone. It is an imperative and general provision of state action, and, therefore, it is mandatory. Moreover, Ascensão (1987) argues that the law is the text or formula imposed through the normative act that contains legal rules. He further adds that “the Law itself is not primarily an activity or a rule, but a text or formula, in a way qualified.” The evolution of the exact sciences may be one of the reasons that led scholars to argue for the existence of economic laws, although these result from theories and doctrines, but some of their formulations have legal commands when it comes, for example, to requiring economic agents to fulfill an obligation within the scope of economic activity. Now, if the law regulates a relationship between the constituted power and individuals and serves as a command in regulating people in society, it is on this basis that economic science seeks, in our view, to take advantage to assert its existence, also in economic activity, through the so-called economic laws. However, the problem lies in the observance of normative precepts by the recipients of such laws. Although the law, through its normative commands, obliges the recipients to its strict compliance, the same cannot be said regarding the degree of acceptability in complying with the so-called economic laws coming from economic thinkers. However, in political economy, there are aspects of a moral nature, such as how society views life in society, the issue of mutual respect, and social conduct in all its aspects, where the idea of a moral law underlies, to which individuals are bound. By their behavior, human beings know that certain conduct can be harmful or can create a mismatch or disturbance in the economy. For example, consider someone who puts a certain commodity on the market and speculates on its price, not allowing its demand or purchase by customers. If it is a basic necessity, the State may create a law to regulate the supply and demand for that good. In this case, the economic agent placing the product on the market will be required to comply with the rules established in the mentioned law. Failure to comply with the legal determination subjects the agent to penalties. Let’s also assume that someone, without prior authorization from the Bank of Mozambique (Central Bank), decides to take money abroad and is detected at the border. In this case, it is an offense that should be analyzed in two aspects: the legal offense, in the legal sense, and the offense against economic and social ethical order, filling the moral offense. The offending party is subject to punishment. This is the power that monetary law possesses as a normative command with mandatory compliance, which does not happen, for example, when the offender is criticized by the population for the act committed. The law that promotes the observance of savings or financial reserve for the purpose of investing in a business activity, for example, the entrepreneur will save if he has the money to do so and will create a financial reserve if he obtains a certain gain, depending on his capacity to generate income for this purpose. Unlike, for example, the situation where the entrepreneur is required to set aside a certain monetary value as savings, and failing to do so may result in a legal offense. Now, if the offending agent engages in harmful acts without the knowledge of the competent authorities, society may vehemently reprimand him. As can be observed, all the examples listed revolve around various legal and economic concepts, emphasizing the fact that legal norms and law, in general, distinguish themselves from ethical and moral norms. As is known, law does not identify with morality, but it is defensible that because society has values to defend, morality emerges as a fundamental element in the realm of justice. Law is motivated by justice. It is a well-established fact that economic and social life develops based on certain rules, and it is up to political economy to reveal the effect of these rules and their efficient application. Moreover, economic rules reflect an intrinsic, essential, and permanent relationship between economic and social phenomena, that is, in economic and social life. We do not doubt that economic rules aim to achieve a certain objective and depend on human will or consciousness; however, they differ from the laws of nature because they only arise in the process of economic activity carried out by humans and reflect the essence of production and consumption relations. The laws of nature obey principles beyond human control. Economic rules vary according to modes of production and from society to society, tending to prevail for a certain period and in a specific space. The economic laws designated to translate the essence of economic relations between the State and economic agents within economic plans, which vary within the economic process or circuit, also have legal commands and cannot be framed within the scope of enunciative laws of economic theories and doctrines. They aim to specify how economic activity should develop and can fit into a law of the economic plan, an essential legal instrument that binds the legal entities covered by it. From this law, general laws may arise that aim to materialize each specific economic situation, that is, what should be done to achieve the objectives enshrined in the economic plan law. It would be more accurate to call them laws of economics rather than economic laws.
5. ECONOMIC LAWS: NORMATIVE OR ENUNCIATIVE?
As economic laws, as we have seen, do not create legal norms in the true sense of law but rather enunciate rules of specialized conduct for economic agents in the scope of their economic activity. They cannot, therefore, be designated as laws in the true legal sense because they do not bind or sanction economic agents in their application. These laws, being enunciative, expose and propose doctrinal thinking about various economic phenomena. They are laws that, by their nature and logical relation, form a coherent system of economic thought used by society in economic activity, whereas normative laws, generally known as creators of legal norms, are characterized by generality, abstraction, and sanction. They are binding and mandatory. In fact, there is a clear identification of law with right due to the expansion of its empire, especially considering the Enlightenment and positivism, in which the reorganization of society through normative means was believed, the reasonable decision made by reasonable men, namely the bourgeois parliamentarians of that time. The state has never waived the use of law as its monopoly instrument in the normativity scope, in defense of legal security and certainties, among other factors that can ensure the existence and maintenance of political power. In summary, we can say that economic laws are enunciative and not binding, resulting from propositions, expositions, and doctrinal declarations by economic thinkers of certain periods, and their compliance is optional, while normative laws emanate from sovereign bodies, and compliance is binding and mandatory. Understood in this way, there is no terminological conflict, as economic laws, as we have seen, are considered enunciative rules, while in legal jargon, laws are always laws in the true sense, leaving no doubt about their characteristics and their true objective sense.
6. CONCLUSION
The controversy surrounding the expression “economic laws” regarding its true meaning concerns social science scholars due to the confusion regarding its legal designation. Economists use the term “economic laws” when referring to principles, propositions, theories, and doctrines within the realm of production, exchanges, and consumption. Since these matters fall within the realm of probabilities, options, and how scarce productive resources can be utilized in an organized society in terms of their generation and appropriation, they are based on certain laws that are established and implemented. Indeed, the development of the economy results in the creation of its own laws for description, explanation, and prediction, though uncertainties and variables may alter forecasts and expected outcomes. However, the state, through its organs, creates laws aimed at regulating and harmonizing economic activity. These economic laws regulate economic aspects and relationships between various economic agents, unlike laws that articulate propositions, declarations, or doctrinal positions on a particular economic matter. Political economy, as a historical science, studies the specific laws of an economic and social system historically, at a given time, and their modifications do not adhere to the traditional legislative process carried out by legislative bodies. Instead, they are influenced by economic phenomena that unfold in a specific period of social life. Therefore, economic laws are not truly laws; they are enunciative rules about the realization and development of the economic process in a specific space and time. They emanate from economic thought, in contrast to normative laws that originate from sovereign bodies and have a binding and mandatory character.
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[1] The present material is written in Mozambican Portuguese and may contain linguistic divergences from Brazilian Portuguese.
[2] PhD in Law.
Submitted: October 2022.
Approved: November 2022.
