Economic regulation and the late nineteenth-century Supreme Court: An economic interpretation of the relation between police powers and substantive due process

Abstract

The late nineteenth-century Supreme Court rulings on the constitutionality of state labor laws offer a fertile field for application of models of economic regulation. This study examines several key decisions, including the rulings on the famous Slaughterhouse Cases (1873) and the case of Butcher's Union Co. v. Crescent City Co. (1884), which marked out the Court's approach to the economic due process clause in the Fourteenth Amendment. The interest group model of regulation is found to be of limited value in understanding the Court's limitations on state police powers. It is argued instead that the market failure model, as interpreted in the framework of the common law's approach to economic regulation, provides a more credible explanation of the Court's opinions. They are better understood in light of the common law distinction between the legitimate and illegitimate application of regulation under state police powers.