Law and conduct are intertwined. As enough people take heed of its call, the law infl uences social behaviour, allowing policymakers to craft rules to effect desired outcomes. Thus, liberal democracies enforce property rights, proscribe criminality, impose liability in tort, and grant damages for breach of contract to promote certain goals. They believe that people respond to positive incentives, such as promised rewards, and to negative ones, such as threatened punishment. Society recognises that law can affect the rate of accidents, crime, innovation, competition, and other matters of public importance. If legislatures pass laws to spur particular goals, then they must understand how rules shape conduct. Economics is the study of incentives, and thus provides the requisite understanding. It predicts how rules will affect behaviour, enabling lawmakers embracing a forward- looking theory of justice to mould doctrine to achieve desired results. Especially since the 1970s, economic research has explored how law affects incentives, thus informing the law’s theory, content, and practice to this day. Such has been its infl uence that commentators variously describe law and economics as, “by almost any measure, the most dominant school of legal thought in the last half a century” 1 and as “the most infl uential development in legal thought since the demise of legal realism in the early 1940s”. 2 The discipline is the predominant methodology for understanding law in the United States, and is growing in infl uence elsewhere. This book introduces the fi eld of law and economics, presenting the subject as a powerful analytic tool. It extrapolates the central tenets of law- and-economics theory, and reveals how those principles shed light on countless legal questions. It focuses on the economic analysis of tort, crime, contracts, property, litigation, innovation, competition, and regulation. This introductory section orientates the uninitiated reader to the fi eld, explaining some threshold concepts useful for understanding law and economics. Those topics include distinguishing positive and normative analysis, explaining the “effi ciency” or wealth- maximisation criterion that economists sometimes use to defi ne optimal laws, and noting the value of interdisciplinary legal study. It concludes with representative insights that economics has made into legal doctrine, theory, and practice.