Nate Oman opines:
Generations of law professors have always insisted that there is some class of rules where the particular content of the law is less important than that we have some clear answer to a question. The paradigmatic example is a rule specifying which side of the road one ought to drive on. The decision, so the argument goes, is entirely arbitrary so long as we all pick a side.
Not so it would seem.
The country of Samoa (not to be confused with the U.S. territory American Samoa) is about the switch from driving on the right side of the road to driving on the left side of the road, reports the WSJ. Somoa is much closer to New Zealand and Australia than to the United States. Apparently over 100,000 Samoan expats live in both countries and they want to be able to send their old cars home to relatives in the islands. By switching sides, the government hopes to facilitate the flow of cheaper, hand-me-down cars into the country. Interestingly, however, the article argues that the original American choice to drive on the right hand side was not as arbitrary as the law profs would have us believe:
American drivers of horse-drawn carriages tended to ride their horses, or walk alongside them, on the left-hand side of their vehicles so they could wield whips with their right hands. That made it necessary to lead carriages down the right side of the road so drivers could be nearer the center of the street.
The article doesn’t explain why it is that the Brits opted for the left hand side. Maybe they are all left handed, or perhaps they learned to use a whip with their right hand as part of some sort of public school hazing ritual. Isn’t there something in a Dickens novel about that?
Maybe generations of law professors have been wrong about the rule of the road, but anybody who has actually studied the problem knows that there are often policy reasons for a choice of side of the road on which to drive.
Countries that have switched sides of the road on which they drive in modern times have often done so because they border countries that drive on the other side of the road and are dependent on cross-border trade with those countries. Switching sides makes cross-border traffic easier and safer.
Note that while the dominant trend has been towards driving on the right, the largest countries with left hand drive are isolated islands with no neighbors to worry about: The UK (setting side the Chunnel and ferries, both of which were designed to facilitate changing sides), Japan, Australia, new Zealand and so on.
If you push hard enough, there is usually some logic to the choice.
As for the origin of the rule of the road, there are various stories. Peter Kincaid, for example, argues that Japan went with left hand drive, because Samurai always walked on the left hand side of the road. Most of them were right handed and wanted their sword hand on the side from which a potential enemy would approach. Similar stories are told about English knights, who road on the left hand side of the road to keep their sword hand towards potential opponents. In contrast, in pacific countries -- like the US -- the rule of the road was set by farmers, wagoners, and carters. People tend to instinctively walk on the right (I've noticed this in both Japan and Australia), unless they expect to use their swords. The same would be true when they lead horses or other animals leading a wagon or cart.
Why do I care? There are lots of situations in which the law has to solve a coordination problem. As Nate observes, there are often claims that the precise content solution is arbitrary and all that matters is that we have a single solution. Closely related to such claims are comparable claims that our forefathers reached the wrong solution, but that factors like network effects or path dependence perpetuate the wrong choice. Ergo, the argument runs, the law should intervene to change the current solution.
I think these arguments are often wrong. Path dependence, for example, claims that inefficient local equilibria can persist over time. Initial conditions, which may be determined by chance or other non-economic forces (such as political interests), direct the system down a particular path. Subsequent deviations from that path may be precluded as too costly, even if there are more desirable or efficient alternatives available. Where the cost of reversing the initially chosen starting point or conditions is especially high, an inefficient equilibrium may result that resists correction by market forces.
When you examine path dependence stories, however, it often turns out that the allegedly inefficient coordination solution in fact has a logical policy explanation. Or it turns out that the supposedly superior alternative in fact is less attractive than its proponents make out. Or it turns out that markets can self-correct.
The broader point to be gleaned from the parable of the rule of the road is that it's too easy to be lazy about our assumptions. Before deciding that there's no logical reason for the world to work the way it does and that we therefore should change it to some superior state of affairs, we need to press the point. We need to figure out if the alternatives really are feasible. We need to figure out whether there is a logical explanation for the status quo. And so on.
