The purpose of this paper is to describe the role of
government, and its various functions with respect to how politics and regulation affect the marketplace.
Uncle Milton (Friedman that is) has asserted that" the proper role of government is to protect property rights and enforce contracts". This leads to the question of whether or not the marketplace is self-regulating.
The heart of the American legal system is the body of work that originated with William the Conqueror in 1066: the common law. The main characteristic of the common law is the doctrine of precedent which holds that prior decisions involving same or similar facts are treated in the same manner when it comes to resolving disputes. The United States adopted the common law as it had developed in England up to the time of the revolution; since that time the United States has carried out the tradition of common law in its own court system. Common law is also described as a system of cases, and courts render justice accordingly.
A contract is a binding agreement between two or more people that have an understanding of the mind. Without this understanding, a contract is generally nul and void. The main characteristics and requisites of a contract are: (1) mutual assent, (2) capacity of parties, (3) consideration, and (4) legality o subject matter.
Mutual assent is arrived upon between the parties with a definite and certain offer made by the offeror to the offeree who accepts. The offer has to be serious, and all terms stipulated in the offer must be agreed upon. Fraud, duress, and undue influence will render a contract unenforceable.
Capacity to enter into a contract refers to the mental capabilities of the parties. Infants, mental incompetents, and drunken people that are incapable of understanding the content and nature of a transaction lack the legal definition and ability to contract.
Consideration is the price bargained for in the agree...