2003] The Uses of History in Law and Economics 669 Figure 3: Venn diagram -No Interaction among fields w and Economic conomIc History In the first edition of Economic Analysis of Law(1972), what Posner termed" the economic logic of the common law "was the first theoretical argument in law and economics to draw the attention of scholars in the emerging field of the history of law. Strangely, this promising start did not lead to early interaction between law and economics and legal historians or to an early turn to history in law and economics. Posner based his thesis that common law exhibits a tendency toward efficiency on a few historical examples from nineteenth-century America, including: enterprise liability for faulty products; industrial accidents; railroad-crossing accidents; damage caused by train engine sparks; and the impossibility doctrine in contracts. 3 He claimed that these examples, when viewed in the framework ofhis positive theory of common law, confirm his thesis. These examples also serve to counter arguments that common law is either irrelevant to economic growt or encourages economic growth by subsidizing big business and increasing social inequality Posner did not base his claims on thorough historical research, but he most decidedly challenged historians. His positive theory of the law was historical in nature. It purported to explain how law changes over time This explanation was too deterministic for most legal historians. It subjected their micro-historical interpretations to his macro theory and, in a sense, made them secondary to it. Furthermore, he used concrete examples rooted in time and place that are central to the work of many American legal storians. In doing so, he called into dispute concrete historical studies. It 13 Richard Posner, Economic Analysis of Law 98-102(1st ed 1972)2003] The Uses of History in Law and Economics 669 Figure 3: Venn Diagram — No Interaction among Fields In the first edition of Economic Analysis of Law (1972), what Posner termed "the economic logic of the common law" was the first theoretical argument in law and economics to draw the attention of scholars in the emerging field of the history of law. Strangely, this promising start did not lead to early interaction between law and economics and legal historians or to an early turn to history in law and economics. Posner based his thesis that common law exhibits a tendency toward efficiency on a few historical examples from nineteenth-century America, including: enterprise liability for faulty products; industrial accidents; railroad-crossing accidents; damage caused by train engine sparks; and the impossibility doctrine in contracts.13 He claimed that these examples, when viewed in the framework of his positive theory of common law, confirm his thesis. These examples also serve to counter arguments that common law is either irrelevant to economic growth or encourages economic growth by subsidizing big business and increasing social inequality. Posner did not base his claims on thorough historical research, but he most decidedly challenged historians. His positive theory of the law was historical in nature. It purported to explain how law changes over time. This explanation was too deterministic for most legal historians. It subjected their micro-historical interpretations to his macro theory and, in a sense, made them secondary to it. Furthermore, he used concrete examples rooted in time and place that are central to the work of many American legal historians. In doing so, he called into dispute concrete historical studies. It 13 Richard Posner, Economic Analysis of Law 98-102 (1st ed. 1972)