Polycentric law

Law does not have to come from a single territorial sovereign. In a polycentric legal order several rule-makers and courts overlap, and people can choose, or are assigned, the one that governs a given relationship.

Bruce Benson's The Enterprise of Law (1990) argues that customary and merchant law historically developed without the state and that competition between providers would improve legal quality. Vincent Ostrom's polycentricity is a broader, less radical idea: many centres of decision-making operating under an overarching system of rules.

• Medieval Europe combined canon, royal, manorial, urban and merchant jurisdictions.
• Commercial parties today routinely contract out of state courts into arbitration.
• The Dubai International Financial Centre runs English-language common-law courts inside a civil-law country.

Emily Kadens (2012) shows that the 'customary law merchant' was in large part a myth: merchants relied heavily on contracts and on public courts. Critics also point to forum shopping, unequal access for weaker parties and the absence of protection for third parties who never chose a provider.

Partial polycentric arrangements are common and stable when a state still guarantees enforcement. A fully polycentric order without any overarching enforcer has no contemporary example in the atlas.