A legal system does not function in a vacuum of abstractions. It is part of a general institutional framework of an organized society. Its content is determined by concrete individual and social needs and activities. Hence modern jurisprudence conceives of law as a means for securing interests. The appraisal of its rules and principles requires an evaluation of the significant elements of the situation to which they apply. A narrow, complacent formalism is the penalty of failure in this regard. No one would deny the emphasis modern society places upor its commercial and industrial interests, nor the many points of contact between its legal and economic systems. Their problems are so inextricably interwoven that the proper answer to questions of law frequently turns on correct economic analysis. If the advent of income taxes has done nothing else, it has at least forcibly emphasized that fact. One phase of this inter-relation will be considered in the following discussion, namely, the determination of legal rights involving questions of income.
Net Income and Judicial Economics,
Mich. L. Rev.
Available at: https://repository.law.umich.edu/mlr/vol20/iss6/9