Tjon Soei Len, Lyn K.L.; Alexander, Gregory S.; van Domselaar, Iris (2014). 'Capabilities and Law: Ownership, Economic Exchange and, the role of the Judiciary' Paper presented at the annual conference of the HDCA, 2-5 September 2014, Athens, Greece.

The global economic crisis has severely impacted individuals' abilities across the globe to engage in valuable activities. Rescue and bailout measures have lead to vanished future prospects for many talented young people who are confronted with high unemployment rates, and families who have been placed out of their homes as a result of foreclosures and evictions. Many consider the collapse of the in 2008 as a consequence of deregulatory developments in the preceding decades. From that perspective, the financial crisis can be read as a dark illustration of the dismantling of the foundational regulatory, legal and institutional structures that underpin well functioning markets, i.e. markets that facilitate and enhance human flourishing. Post-crisis, legal structures (can) play a central role in abating the devastating implications of the crisis for human lives. Capabilities enhancing interpretations of law, legal structures and legal institutions have shown great potential for positively impacting the lives of those who are negatively affected. For instance, although eviction laws in Spain initially placed many struggling homeowners on the street, the European Court of Justice provided relief by pointing to the power of the judiciary to evaluate the fairness of mortgage agreements in effect creating a delay and freeze of looming evictions. In short, the global crisis reminds us of the close relationship between capabilities that facilitate human flourishing and the fundamental legal structures that support and enhance them. An important role for capabilities and legal scholars is to (re)construct interpretations of capabilities and of law, and the relationship between the two, that enhance the abilities of individuals to live flourishing lives.

The contributions in this panel detail in various ways the pivotal importance of the relationship between capabilities and law and contribute to a deeper understanding of how law, legal structures and legal institutions can enhance capabilities that facilitate human flourishing. This panel offers two contributions (1 & 2) that speak to the legal structures that are fundamental for the proper functioning of markets, and to the role of the state in enhancing capabilities in a context of (increasing) inequality that endures as a result of otherwise well functioning markets. The third contribution speaks to the role and central features of the judiciary as a legal institution that is responsible for securing to each individual the opportunity to live a life in accordance with human dignity.

1. Capabilities, Human Flourishing and the Obligations of Ownership

In the contribution from Gregory S. Alexander (Cornell University, Ithaca, NY, U.S.A) it will be argued that all individuals have an obligation to others in the various and multiple communities to which they belong to promote certain capabilities that are necessary for human flourishing. For property owners, this normative thesis has important consequences. If we accept the existence of an obligation to foster the capabilities necessary for human flourishing, and if we understand that obligation as extending to an obligation to share property, at least in surplus resources, then it follows that to enhance the abilities of others to flourish, in the predictable absence of adequate voluntary transfers, the state should be empowered and may even be obligated to compel the wealthy to share their surplus with the poor so that the latter can develop the necessary capabilities.  None of this is meant to suggest that the state's power, even as it touches on the facilitation of the capabilities we are discussing, is unbounded. But the limits to the state's proper domain are supplied by the same principles that justify its action: the demands generated by the capabilities that facilitate human flourishing.

2. Capabilities and the Moral Limits of Economic Exchange

The importance of economic exchange is inextricably bound to the importance of the ability to hold private property. Namely, the ability to hold property and property rights seems devoid of real meaning, if these do not include, centrally, the possibility to exchange. But most people agree that there are moral limits to the types of economic exchanges the state should endorse; not everything should be for sale, not every relationship should be subject to market rationality and not all consequences of consensual exchange should be endorsed by the state. These normative claims have special significance in a context of severe inequality. Legal institutions may recognize 'moral limits' of economic exchange as a way to provide (economic) relief to and thereby protect vulnerable market participants. The contribution from Lyn K.L. Tjon Soei Len (University of Amsterdam, Amsterdam, The Netherlands) constructs a capabilities based interpretation of the moral limits of economic exchange. It argues that the ability to engage in economic exchange on an equal basis with others is of central importance to human flourishing and details the implications of that thesis for the moral limits of economic exchange.

3. Wise and just gardeners: on the judiciary in Nussbaum's Capabilities Approach

The aim of Nussbaum's Capabilities Approach is relatively clear: to secure that each and every citizen has the opportunity to live a life in accord with human dignity. A society is just to the extent that it manages to secure to all citizens the Central Human Capabilities up to an adequate threshold level. As it stands, however, the Capabilities Approach is less clear about how this goal is to be realized, i.e. about what the implications are for the responsibility bearing institutions in society.  This paper explores the role and central features of the judiciary within Nussbaum's Capabilities Approach, as one such responsibility bearing institution. More specifically it argues that these features are characteristic for a virtue-ethical approach to adjudication. Finally, the paper addresses the question whether such a virtue-ethical approach to adjudication is reconcilable with Nussbaum's commitment to the principle of political legitimacy.