Synonyms

Informal law, Polycentric law, Private law, Stateless law

Definition

  • Customary law: A system of rules of obligation and governance processes that spontaneously evolve from the bottom-up within a community.

“Customary law” sometimes refers to various immanent principles, so well established and widely recognized that sovereigns feel obliged to adopt them as law (e.g., as in common law recognition of “immemorial custom”), but it also can be applied to the legal arrangements within primitive communities. Another definition delineates the source of immanent customary principles, however, and encompasses primitive law: Customary law is a system of rules of obligation and governance processes that spontaneously evolve from the bottom-up within a community (Pospisil 1971). This definition is the focus of the following presentation. Those who contend that “law” consists of general commands of a sovereign will not consider this concept to be appropriately labeled as law, nor will those who contend that “law” applies to moral principles, whether logically derived or handed down by a higher being. Nonetheless, these rules and processes are real, and they influence behavior in very significant ways. This is true for the primitive (Pospisil 1971; Benson 1991), medieval (Friedman 1979), and contemporary tribal societies (Benson and Siddiqui 2014), merchant communities during the high middle ages (Benson 1989, 2014), modern international trade (Benson 1989), and many other historical and current settings (Fuller 1981).

Kreps (1990) stresses that socially or culturally derived experiences help players “know” what to do and predict what other players will do. In this context, Hayek (1973, pp. 96–97) observes that many issues of “law” are not “whether the parties have abused anybody’s will, but whether their actions have conformed to expectations which other parties had reasonably formed because they corresponded to the practices on which the everyday conduct of the members of the group was based. The significance of customs here is that they give rise to expectations that guide people's actions, and what will be regarded as binding will therefore be those practices that everybody counts on being observed and which thereby condition the success of most activities.” Similarly, Fuller (1981, p. 213) explains that “We sometimes speak of customary law as offering an unwritten code of conduct. The word code is appropriate here because what is involved is not simply a negation, … but of this negation, the meaning it confers on foreseeable and approved actions, which then furnish a point of orientation for ongoing interactive responses.” In this light, behavioral patterns individuals within a community are generally expected to adopt and follow in their various interdependent activities are considered to be legal rules below, whether those rules (expectations) arise through formal legislation or informal customary processes discussed below. Individuals are expected to follow such rules, and these expectations influence the choices made by other individuals. Customary law involves more than rules of behavior, however, as customary governance processes also evolve from the bottom-up (Benson 1989, 2011, 2014; Pospisil 1971). Development and characteristics of both customary behavioral rules and procedural rules are discussed below.

Introduction

Customary law, a system of rules of obligation and governance processes that spontaneously evolve from the bottom-up within a community, guides behavior in primitive, medieval, and contemporary tribal societies, as well as merchant communities during the high middle ages, modern international trade, and many other historical and current settings. Rules and procedures are recognized and accepted because of trust arrangements, reciprocities, mutual insurance, and reputation mechanisms, including ostracism threats. Negotiation (contracting) generally is the most important source for initiating change in customary law. Such agreements only apply to the parties involved, but others can voluntarily adopt the change if it proves to be beneficial. An individual also may unilaterally adopt behavior that others observe, come to expect, and emulate, or a dispute may arise that results in an innovative solution offered by a third party and voluntarily adopted by others. Many different third-party dispute resolutions procedures are observed in different customary communities, but they generally involve experienced mediators or arbitrators who are highly regarded community members. Some of these adjudicators may have leadership status, but leadership arises through persuasion and leaders do not have coercive authority. Since there is no coercive authority, protection and policing rely on voluntary arrangements, and community norms encourage and reward such activity. People who violate rules are generally expected to and have incentives to compensate victims for harms. Customary law is polycentric, with hierarchical arrangements to deal with intercommunity interactions. Customary law also may conflict with authoritarian law. When this occurs, a coercive authority may attempt to assert jurisdiction over a customary-law community, but this will have very different impacts depending on the options available to members of the community. The authority often adopts and enforces some customary rules in order to avoid conflict.

Establishing and Recognizing Customary Rules

Vanberg and Buchanan (1990, p. 18) define rules of behavior toward others which individuals have positive incentives to voluntarily recognize as “trust rules” and explain that:

By his compliance or non-compliance with trust rules, a person selectively affects specific other persons. Because compliance and non-compliance with trust rules are thus “targeted,” the possibility exists of forming cooperative clusters…. Even in an otherwise totally dishonest world, any two individuals who start to deal with each other – by keeping promises, respecting property, and so on – would fare better than their fellows because of the gains from cooperation that they would be able to realize.

Game theory demonstrates that such cooperation can arise through repeated interactions, although the dominant strategy in bilateral games still depends on expected payoffs, frequency of interaction, time horizons, and other considerations (Ridley 1996, pp. 74–75). As North (1990, p. 15) explains, however, game theory “does not provide us with a theory of the underlying costs of transacting and how those costs are altered by different institutional structures.” For example, if bilateral relationships form in recognition of the benefits from cooperation in repeated games, and if individuals in such relationships enter into similar arrangements with other individuals, a loose knit group with intermeshing reciprocal relationships develops. As this occurs, tit for tat becomes less significant as a threat, while expected payoffs from adopting trust rules increase. For instance, an exit threat becomes credible when each individual is involved in several different games with different players, in part because the same benefits of cooperation may be available from alternative sources (Vanberg and Congleton 1992, p. 426).

When the exit option becomes viable, Vanberg and Congleton (1992, p. 421) explain that a potential strategy is unconditional cooperation unless uncooperative behavior is confronted and then imposition of some form of explicit punishment on the noncooperative player as exit occurs. They label such a strategy “retributive morality”; examples include the “blood feuds” of tribal (Benson and Siddiqui 2014) and medieval (Friedman 1979) societies. Retributive morality strengthens the threat against noncooperative behavior relative to tit for tat. Such violence is risky, however, and there is likely to be a better alternative. Since all community members have exit options, information about uncooperative behavior can be spread, creating incentives for everyone to avoid interacting with the untrustworthy individual. This suggests a strategy involving unconditional cooperation in all interactions with other community members, along with a refusal to interact with any individual who is known to have adopted noncooperative behavior with anyone in the group and the spread of information about such behavior. Vanberg and Congleton (1992) refer to this response as “prudent morality,” and given that reputation information spreads quickly and everyone spontaneously responds to information, the result is spontaneous social ostracism. Depending in part on THE severity of the offenses, however, ostracism may not be absolute. Individuals might continue interacting with someone who has misbehaved, but only if certain conditions are met to reduce risk (e.g., a bond might have to be posted). Such conditions sanction an offender by raising costs or reducing his benefits in various interactions.

Many group-wide customary rules are simply commonly shared trust rules. Others, called “solidarity rules” by Vanberg and Buchanan (1990, pp. 185–186), are expected to be followed by all members of the group. The spontaneous development of social ostracism illustrates this. Solidarity rules produce community-wide benefits (Vanberg and Buchanan 1990, p. 115), including general deterrence and others discussed below.

Changing Customary Rules

Rules and communities evolve simultaneously: The evolution of trust rules leads to the development of a web of interrelationships that become a “close-knit” community, and the evolving web of interactions and expanding opportunities for interactions in turn facilitates the evolution of more rules. If conditions change or a new opportunity is recognized, for instance, and a set of individuals decide that, for their purposes, a new behavioral obligation arrangement will support more mutual benefits, they can voluntarily agree to accept (contract to adopt) the obligations. Such new obligations only apply for the contracting parties for the term of the contract. Individuals who interact with these parties learn about their contractual innovation, however, and/or members of the community observe its results. If the results are desirable, the new rules can be rapidly emulated. Such changes are initiated without prior consent of or simultaneous recognition by any other members of the relevant community, but they can be spread through voluntary adoption. Indeed, as Fuller (1981, pp. 224–225) explains, “If we permit ourselves to think of contract law as the ‘law’ that parties themselves bring into existence by their agreement, the transition from customary law to contract law becomes a very easy one indeed.” In fact, contract and custom are tightly intertwined and often inseparable:

if problems arise which are left without verbal solution in the parties’ contract these will commonly be resolved by asking what “standard practice” is with respect to the issues… In such a case it is difficult to know whether to say that … the parties became subject to a governing body of customary law or to say that they have by tacit agreement incorporated standard practice into the terms of the contract.

… [Furthermore,] … the parties may have conducted themselves toward one another in such a way that one can say that a tacit exchange of promises has taken place. Here the analogy between contract and customary law approaches identity. (Fuller 1981, p. 176)

Negotiation (contracting) generally is the most important source for initiating change in customary law (Fuller 1981, p. 157), although there are others. An individual may unilaterally adopt behavior that others observe, come to expect, and emulate, for instance, or a dispute may arise that results in an innovative solution offered by a third party.

If new obligations are required to deal with the new situation, transaction costs may prevent individuals from agreeing on an appropriate arrangement. Similarly, one party may believe that a particular rule applies to a situation, while another may believe that a different rule is relevant. If direct negotiation fails, a solution may still be achieved if the parties turn to arbitration or mediation. Many different third-party dispute resolution procedures are observed in different customary communities (Benson 1991, 2011, 2014), but they generally involve experienced mediators or arbitrators who are highly regarded community members. They may be paid or they may voluntarily give their time in order to enhance their reputations. Whatever the process, a potential rule may be suggested by the dispute resolution (Fuller 1981, pp. 110–111). Unlike modern common law precedent, however, the resolution only applies to the parties in the dispute. If it suggests behavior that effectively facilitates desirable interactions, the implied rule can be adopted and spread through the community.

Reciprocity and Restitution

When retributive morality dominates, unilateral exaction of punishment can be very risky, as noted above, and generate negative spillovers for the larger community. As a result, customary rules tend to evolve to reduce revenge seeking and encourage substitution of ostracism for retribution, as suggested above, but another option also commonly arises. To understand why, note that unregulated retaliation may result in greater costs for the alleged offender than the costs generated by the offender’s initial offense, leading to an escalating chain of violence. In a dynamic society, this ongoing feud consumes resources, including human life, and, therefore, dissipates wealth. In subsistence societies, the loss of such wealth can be devastating, but even as wealth expands, the opportunity cost of escalating feuds is high. Some of these costs are also likely to be external. Therefore, strong incentives arise among community members to constrain retribution. Parisi (2001) explains that rules generally evolve to specify who can pursue retribution (e.g., only the victim or a member of his extended family or support group discussed below) and to set an upper bound on the harm imposed on the offender based on the harm initially inflicted on the victim. Over time, the level of retribution moves to one of symmetry, “an eye for an eye.” Once the severity of punishment is generally expected to be proportional, it becomes predictable, and the transaction costs of bargaining fall because the parties can bargain over a known “commodity.” If the offender is willing to pay compensation that at least offsets the value the victim places on revenge, then violence can be avoided. In fact, in many customary-law systems, offenders reestablish membership in the community when appropriate payments are made. So-called blood money becomes increasingly prevalent.

History and anthropology suggest that customary restitution rules may be quite simple or very complex. For example, the Hebrew Bible dictates that “When anyone, man or woman, wrongs another…, that person has incurred guilt which demands reparation. He shall confess the sin he has committed, make restitution in full with the addition of one fifth, and give it to the man to whom compensation is due” (The New English Bible, Numbers 5: 6–7). Some customary legal systems include widely recognized rules detailing payments for virtually every type of predictable harm (e.g., Goldsmidt 1951; Benson 1991, 2011; Barton 1967). In some societies, including medieval Iceland (Friedman 1979), the payment also depends in part on whether the offender tries to hide or deny the offense. If the offender admits guilt, thereby lowering the costs of enforcement, the payment is lower. Repeat offenders are also treated differently in many restitution-based systems. In Anglo-Saxon England, for instance, an offender could “buy back the peace” on a first offense, but for some kinds of illegal acts, a second offense was not forgiven. Such an offender becomes an outlaw with no protection, making him fair game for anyone who wanted to attack him. Restitution-based systems also account for the problem of collections from potentially “judgment-proof” offenders. Payments do not necessarily have to be monetary, for instance, as labor services or other “goods” can serve as restitution. In Anglo-Saxon England, offenders had up to a year to pay large awards, and if more time was required, they become “indentured servants” until the debt was worked off (Benson 2011, p. 25; 1994).

Bargaining power may differ between individuals, leading to variance in restitution for similar harms, so not surprisingly reciprocal mutual support groups typically develop in customary-law communities. These groups may consist of family members, for instance, but they also may be based on neighborhoods, religious affiliation, ethnicity, participation in the same commercial activity, or some other factor. Such groups accept reciprocal obligations to assist each other in the pursuit of justice, although they generally have many other reciprocal expectations, including social, religious, and joint production activities. Mutual support groups also may pay the restitution to a victim for someone in the group who cannot pay immediately, so the offender is obliged to pay members of his own support group. When such groups develop surety obligations, they also may purchase indentured-servitude contracts so offenders work for members of their own groups rather than for their victims.

Clearly, hardships imposed on wealthy offenders who pay a fixed restitution are less significant than the same payment for poor offenders. Thus, restitution may require a relatively large payment by a wealthy offender, enhancing their deterrence incentives. On the other hand, if a person is diverted from earning income to pursue and prosecute an offender, the value of lost time will be much higher for an individual earning a high income than for a low-income person. Therefore, restitution payments for the same offenses may be higher for the well-to-do victim in order to induce participation in the legal process. The schedule of payments in the wergeld or “man price” systems in Anglo-Saxon England reflects the status of the parties involved, as do some tribal customary-law systems (Barton 1967).

Negotiation between a victim and offender may be very difficult, if not impossible, of course, without additional options. As a consequence, a customary rule often develops which requires guilty parties to express remorse or repentance, thereby reducing the costs of negotiation. Substitutes for negotiation are also attractive. A community leader or group of leaders may come forward to encourage repentance and a truce so that negotiations can occur (Benson and Siddiqui 2014). Given the potential animosity between the parties, this third party might also mediate or arbitrate the dispute, or specialists in mediation or arbitration may be called upon. The primacy of rights also changes over time, as a right to restitution supersedes the right to retaliation. In early medieval England and Iceland, and in the large number of tribal societies, victims do not have the right to exact physical punish (retributive morality) unless and until the offender refuses to accept the customary adjudication procedures and/or to pay fair restitution (Benson 2011, pp. 11–30, 1991; Friedman 1979; Pospisil 1971; Goldsmidt 1951; Barton 1967). Similarly, ostracism occurs only when an offender refuses to adjudicate or to pay restitution.

Mutual Insurance

In part, to encourage people to continue to recognize customary behavioral rules, customary-law communities develop mutual insurance arrangements to aid individuals who find themselves in significant risk as a consequence of mistakes, unanticipated natural disasters, warfare, theft, or general bad luck. Johnsen’s (1986) analysis of the potlatch system of the Southern Kwakiutl Indians provides an insightful example. He explains that “In order to provide the incentives of would-be encroachers to recognize exclusive property rights, and thus to prevent violence, those Kwakiutl kinship groups whose fishing seasons were relatively successful transferred wealth through the potlatch system to those groups whose seasons were not successful…. Although potlatching thereby served as a form of insurance, the relevant constraint in its adoption and survival was the cost of enforcing exclusive property rights rather than simple risk aversion” (Johnsen 1986, p. 42). Sharing norms such as hospitality and potlatching are common practices in customary-law societies all over the world (Ridley 1996, pp. 114–124). Therefore, even those who may find themselves in desperate situations know that recovery is possible, so they have relatively strong incentives to live up to customary obligations.

Leadership

Customary-law communities do not have executives with coercive power to induce recognition of law. Leaders arise to facilitate various kinds of cooperation, but they lead through persuasion and example. Leadership also is conditional, with no specified terms or binding claims to loyalty. Leaders generally serve as a nexus of the voluntary relationships that dominated the internal life of a community. Therefore, a very important leadership characteristic is a reputation for making good decisions (wisdom) that benefit his followers. Anyone who acquires a leadership role is likely to be a mature, skilled individual with considerable physical ability and intellectual experience and perhaps, more importantly, someone who has a history of cooperative behavior. The importance of maturity and experience often mean that leaders are relatively old community members (elders). They earn respect (Benson 1991; Pospisil 1971), but they also must continue to earn it. Individuals who achieve leadership positions but then make decisions that turn out to be undesirable to followers lose those followers. Wisdom and respect also are not sufficient to attract substantial numbers of followers (Pospisil 1971, p. 67). A self-interested entrepreneurial leader within a close-knit community rationally chooses to pursue activities that benefited others and/or generously spreads the wealth he gains. “The way in which [leadership or social] capital is acquired and how it is used make a great difference; the [members of the community] … favor rich candidates who are generous and honest” (Pospisil 1971, p. 67). Indeed, in customary-law societies, the honor of being recognized as a leader is often “purchased” through repeated public displays of generosity demonstrated at occasions such as marriages. Third-party mediation or arbitration often develops in close-knit groups, as noted above, and individuals seeking recognition as leaders also may offer to help resolve disputes and provide mediation or arbitration advice free of charge (Pospisil 1971; Benson 1991). “Fair” nonviolent dispute resolution is attractive to community members because it avoids the spillover costs associated with violent dispute resolution, and it is attractive to the “suppliers” of such dispute resolution even when they are not explicitly paid, because it enhances their prestige. In other words, both generous gift and advice giving (e.g., dispute resolution) signal that the individual is wise, successful, cooperative, and trustworthy. As Ridley (1996, p. 138) puts it, such acts “scream out ‘I am an altruist; trust me’.” Leaders engage in such displays of generosity because they expect to benefit in the future through reciprocal obligations and cooperation in joint production. Since leadership positions are available to anyone who can persuade a group to accept his decisions and guidance, customary communities often have multiple leaders. Competition for followers arises, and community members may change their primary allegiances if they feel that a leader has failed to perform well or that another individual offers what appear to be superior options. Specialization among leaders also is not uncommon. A community may have one or more individuals serving as arbitrators or mediators, and/or as religious, hunt, or war leaders, and so on.

Warriors

Joint production of mutual defense against enemies evolves if outside threats are perceived, and such threats often mean an important part of an individual’s belief system will be “a concept of them and us” (e.g., tribalism, patriotism). In fact, an external enemy can strengthen incentives for intragroup cooperation (Ridley 1996, p. 174). There is no centralized authority in a customary-law system; however, so individuals cannot be forced to become soldiers. They have to be persuaded to take on this role. This explains the incentives to propagate cultural beliefs (rules) about honor from bravery and skill in warfare in primitive and medieval communities. Members of customary-law communities facing outside threats (e.g., spouses or potential spouses of warriors, fathers and mothers of potential warriors, elders who can no longer fight) have strong incentives to encourage young males to be brave and to be skilled in combat (Benson and Siddiqui 2014). Thus, the successful warrior is honored, but he also receives many personal rewards. A warrior who backs down from a threat or who does not pursue retribution will be seen as a coward, and this generally will be the greatest fear instilled in boys and young men. The prestige associated with abilities in warfare also encourages entrepreneurial war leaders to organize attacks on enemies. After all, given the belief that some other group is made up of enemies, aggression can easily be rationalized – “the best defense is a good offense” – particularly when the expected gains exceed the expected costs.

The discussion of conflict suggests a question: why warfare rather than cooperation (negotiation, diplomacy) with outsiders. In fact, as explained below, cooperation between members of different communities is also widely observed in customary-law systems. Given the high transaction costs for multiple-community collective action, however, the benefits of intergroup cooperation have to be high for stable cooperation to develop (e.g., high enough for warriors to refrain from aggressive acts even when very attractive opportunities to attack arise). One potentially large benefit from intergroup cooperation arises when two or more groups face the same relatively powerful enemy. In this context, however, it should be noted that terms like “alliance,” which suggest established protocol, permanence, and formality, do not describe military relationships between such communities. These cooperative activities generally are expedient combinations in which distinct and autonomous individuals and groups work toward common but limited aims. Indeed, military coalitions generally are temporary spontaneous arrangements, and they can fall apart when the common threat loses power and/or one of the groups in the coalition gains power relative to others (Benson 2006).

Conflicts between customary-law communities need not be violent. When two different commercial communities have disputes or try to capture each other’s markets, they generally do not go to war with one another. Their warriors may be lawyers who pursue objectives through adversarial adjudication processes that arise, for instance, or lobbyists who compete for political favors in an authoritarian legal system, as discussed below. Conflict is certainly not inevitable, however, if benefits of intercommunity cooperation are significant.

Polycentric Law

Customary rules and procedures often facilitate voluntary cooperative interactions such as trade between members of different customary-law communities (Benson 1988). Groups need not formally “merge” and accept a common set of rules, however, in order to achieve intercommunity cooperation on some dimensions. Individuals only have to expect each other to recognize specific rules pertaining to the types of intergroup interactions that evolve. Indeed, a “jurisdictional hierarchy” may arise wherein each group has its own rules and procedures for intra-community relationships, while a separate more narrowly focused set of behavioral and/or procedural rules applying for intercommunity relations (Pospisil 1971; Benson 1988). For instance, intra-community recognition of rules is likely to be largely based on reciprocities, trust, and reputation, along with ostracism threats (prudent morality), while intergroup recognition may require bonding, strong surety commitments, and/or threats of retribution (retributive morality). A jurisdictional hierarchy also does not create a higher order of law, as intergroup institutions typically have no role in any community’s internal relationships. Thus, customary law is “polycentric,” with multiple parallel “local” jurisdictions, as well as overlapping jurisdictions supporting intercommunity interactions. Many intragroup rules will be common across different groups, of course, as individuals in different groups discover similar ways to deal with an issue. Emulation also will occur where differences initially exist but individuals perceive superior arrangements among other groups (Benson 1988, 1989).

Custom Versus Authority

Pospisil (1971) distinguishes between “legal” arrangements that evolve from the top down through command and coercion, which he called “authoritarian law,” and customary-law systems that evolve from the bottom-up through voluntary interaction. Similarly, Hayek (1973, p. 82) distinguishes between “purpose-independent rules of conduct” that evolve from the bottom-up and rules that are designed for a purpose and imposed by “rulers.” Individuals may be members of different specialized customary-law communities (e.g., diamond merchants (Bernstein 1992) or trade associations (Benson 1995), a neighborhood (Ellickson 1991), or so-called informal or underground communities (de Soto 1989)) while simultaneously being subjected to authoritarian law. Both Hayek’s and Pospisil’s distinctions suggest that customary law also may conflict with authoritarian law. Indeed, as Hayek (1973, p. 82) stresses, “the growth of the purpose-independent rules of conduct which can produce a spontaneous order will … often have taken place in conflict with the aims of the rulers who tended to turn their domain into an organization proper.” When this occurs, an authority backed by coercive power may attempt to assert jurisdiction over a customary-law community, but this will have very different impacts, depending on the options available to members of the community. If the authority is strong enough, a community might be forced to accept the commands, although new customary rules and procedures often evolve that allow a customary-law community to avoid some and perhaps most authoritarian supervision (Bernstein 1992; Benson 1995). This may involve moving “underground,” making the customary rules and procedures difficult to observe, and raising the cost of enforcement for the authority. If a customary-law community (and its wealth) is geographically mobile, however, members may simply move outside an authority's jurisdiction. The threat to move can significantly constrain authoritarian attempts to displace a customary system (Benson 1989). A sovereign who wants to avoid an exodus may even offer to assist in enforcing the customary rules and even explicitly codify them. Indeed, a sovereign may offer special privileges to members of a highly mobile customary community in order to capture benefits including revenues, perhaps directly from tribute or taxes, but also indirectly because of a positive impact that this community has on other less-mobile sources of wealth (e.g., land) that can more easily be controlled and taxed. If customary behavioral rules are absorbed and customary procedures atrophy, an authority may amend or replace many customary rules, although the ability to do so depends on the costs of reinvigorating customary institutions, the mobility of wealth for members of the community, and the privileges granted to the community’s members.

Cross-References