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Kevin E. Davis & Mariana Pargendler, Contract Law Heterodoxy, 4 Revue européenne du droit [RED] (2022) (Fr.).


Abstract: There is an ongoing debate about whether contract law has any role to play in addressing economic inequality 3 . On this view, contract law can at most be used to address imbalances of wealth or power between parties to specific transactions, but not to help parties who are disadvantaged relative to other members of the broader society 4 . In recent years there has been a resurgence of interest in heterodox approaches that allow bodies of law besides tax law to play a role in combatting inequality 5 . Several scholars have argued that contract law ought to be recruited into the battle 6 , resurrecting high-profile earlier debates among U.S. scholars 7 . However, so far, conversations about these heterodox approaches have focused on legal developments in North America and Western Europe. This is unfortunate because economic inequality is a pressing problem in other parts of the world, including in developing countries, some of which may be sites of important legal innovations. In fact, there is a great deal to be learned about contract law heterodoxy from the jurisprudence of developing countries. There are prominent examples of courts and legislatures in Brazil, Colombia and South Africa openly using their control over the legal effects of agreements between private actors to influence the distribution of wealth. Attention to those heterodox developments promises to enrich the debate about the role of contract law in addressing economic inequality around the world. We begin this essay by setting out the theoretical foundations of contract law orthodoxy and then discussing the possible objections. Next, we discuss examples of contract law heterodoxy drawn from our research on contract law in Brazil, Colombia, and South Africa. We conclude by discussing what these examples from the developing world might tell us about the viability of contract law heterodoxy in other countries, including more economically developed countries such as the United States or most members of the European Union.