July 11, 2022
In recent years, scholarship has emerged criticizing various aspects of the Lex Mercatoria—the Law Merchant.
Bruce Benson has been pushing back, and his forthcoming book on these matters ought to be the definitive treatment.
In a working paper, he gives us a taste—here’s the abstract: 
“Hayek (1973, 83) pointed out that ―It is in the … law merchant, and the practices
of the ports and fairs that we must chiefly seek the steps in the evolution of law which ultimately
made an open society possible. A large literature has examined this medieval Lex Mercatoria,
or Law Merchant, much of it supporting Hayek‘s contention, but there also is a growing
literature criticizing the Law Merchant story. One criticism is that during the high Middle Ages,
and even the late Middle Ages, non-simultaneous trades were virtually nonexistent, so issues
such as credibility of promises and enforcement of contracts were not relevant. Some critics go
so far as to argue that the Law Merchant literature is grossly inaccurate, and that those who have written about the system have intentionally misused evidence in order to support a particular political view. Some of these criticisms are addressed in this paper. The medieval Law Merchant was customary law, and many of the criticisms of the literature reflect a misunderstanding of customary law. Therefore, this concept and its implications for interpretation of historical evidence are explained. Aspects of trade in the high Middle Ages are then discussed, stressing the roles of contracting and credit while simultaneously emphasizing some characteristics of the Law Merchant that apparently have not been adequately explained, given recent criticisms. Finally various relationships between the medieval Law Merchant and other legal systems are examined, as these relationships also are significant sources of misunderstanding underlying some criticisms.”
As his paper emphasizes, private law exhibited a mixture of flexibility, resilience, and structure. In a helpful summary of just what the sometimes nebulously-described Law Merchant was, Benson concludes the paper:
“Lex Mercatoria of the high Middle Ages was:
(1) a distinct [but not independent] system of polycentric customary law which arose and
continued to evolve spontaneously from the bottom up through the interactions of merchants in pursuit of universal objectives to enhance the opportunities for contract and trade, and maintain freedom of contract; consisting of:
(2) primary rules of obligation including both long-standing custom and evolving
commercial practices and usage that supported freedom of contract and increased opportunities to contract by increasing the credibility of promises; as well as secondary rules of
(3) change initialized through negotiation (contracting), and perhaps dispute resolution,
followed by voluntary emulation of those practices that best enhanced opportunities to engage in contractual trade and support freedom of contract;
(4) adjudication through processes such as mediation, arbitration, participatory courts and
other courts willing to resolve merchant disputes quickly and equitably; and:
(5) recognition arising from positive incentives to expand contracting opportunities (and
merchant well-being) through maintenance of repeat-dealing and reputation benefits, along with negative incentives created by spontaneous sanctions such as varying degrees of ostracism; but:
(6) this distinct system also interacted, in various complementary and/or competitive
ways over time and space, with other distinct polycentric legal systems that often had objectives
differing from those of the Law Merchant; and as a result:
(7) its primary and secondary rules influenced and a\were influenced by other legal
systems.”