“Intuition. Nothing more, nothing less.”
Hahah.
"To restate the question more broadly: will free-market adjudication result in just decisions?
Leoni (1961) provides a theoretical framework on which we can build an answer to this question. We offer a sketch of his theory. In a market, economic operators regard prices to be ultimate data upon which they base their calculations and actions, fully realizing that these are flexible to some extent, but quite fixed for a particular transaction. By analogy, Leoni suggests that legal operators regard legal norms to be the ultimate data upon which they base their actions, fully realizing these are flexible to some extent, but fixed for a particular adjudication. Extending the analogy, Leoni notes that the economist does not regard prices to be fixed at all, but subject to immutable rules of distribution acting on contingent facts. Likewise, the proper legal theorist does not regard legal norms to be fixed, but subject to immutable rules of argumentation acting on contingent facts of cases within particular cultural contexts. Indeed, the direction of causation of these social elements is often misapprehended. It is the offers to buy and sell in the market that causes prices (the norms of the market) to settle into relative fixity; they are not fixed before agents enter the market, though it appears that way to most economic agents. Likewise, it is the advancing of legal claims in an adjudicative setting and hearing the arguments on both sides that determines the outcomes of proceedings; and the outcomes of many proceedings thereby establish legal norms. It is not the case that legal norms are fixed before legal agents advance their arguments, although it appears that way to lawyers who learn legal norms in law school and then apply them to cases to guess how judges will rule on cases.
But does this mean that legal norms could be anything at all? No, and a number of libertarian theorists have explained why.
As Hoppe pointed out, by rationally advancing your claim against another, you are implicitly claiming that your claim is rationally defensible to a greater extent than your opponent’s: “…any ethical proposal, as well as any other proposition, must be assumed to claim that it is capable of being validated by propositional or argumentative means.” (Hoppe 1993, Ch. 10) All who make claims; or who criticize torts, crimes, legislation, laws, and judicial decisions—in short, all who debate legal norms—implicitly hold that there is a standard against which these decisions are to be measured.
Narveson agrees, applying the insight in the context of egalitarianism:
Here I need merely remind the reader that we are talking about arguments for equality, as distinct from sheer assertions of it. Appeals to intuition—that the commitment to equality is “moral bedrock,” as I have heard it said—must, on the face of it, count in the latter category. As a device for supporting equality, this invites the response that, unfortunately, my “moral bedrock” might be something quite incompatible with the proponent’s: say, that equality is a snare and a delusion. Strange bedrockfellows! So where would we go from there? If it’s anywhere, it’s going to have to be either back to arguments, or to non-rational or irrational activity, such as politics—waving flags, Bosnia, etc. [Narveson 2002, p. 51]
But if the continual clash of individual claims results in rational adjudications, to what legal norms are we led? Narveson takes the case of murder:
It is absurd to say that what’s wrong with murder is that I don’t like it. The obvious response is: “So?” The reason it is the obvious response is that if we are out to regulate the behavior of people in general by suggesting a rule for their deliberate action, then the plausibility of our effort is zero if it turns out that all my proposal has going for it is that I want it or would like it. Who, indeed, cares? Until I can explain why others should care, my proposal will be irrelevant to them. And if it isn’t directed to them, we’re wasting their time. [Ibid.]
… snip …
But where will all of these arguments be advanced? Indeed, where will the complementary arguments of Hoppe (1993), Kinsella (2008), and others (Kinsella 1996) be advanced? We argue that two of the important venues for these arguments, or at least practical applications of them, are mediations and arbitrations.
Section Conclusion
Narveson’s vision of norms is well-adapted to considering the question of this section. The arbiter of a dispute is led by contractarian logic to choose minimally-constraining norms to apply to disputes. One way to consider contractarianism is as a philosophical theory of how free-market adjudication of norms results in the minimal legal norms of libertarian ethics.
This theory of adjudication is confirmed in history. All of the historical free or nearly free markets in law (Roman law, common law, Law Merchant, etc.) have resulted in libertarian-leaning decisions and legal norms."