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This article is the first part of a much longer version (co-authored by Maragaret McCown) presented in October 2000 at the Colloquium on Law, Economics and Politics at New York University School of Law; It is one of the two that examines some of the problems arising from the method of legislation associated with the rule of precedent and the common law doctrine of Stare Decisis. Stone Sweet provides explicit theoretical foundations for the dependence of legal institutions and an argument as to why this should be important for social scientists and lawyers. The paper elaborates an arbitration model in which institutional development and decision-making are linked by highly organized discursive electoral contexts – mesostructures called „argumentation frameworks” organized by judges as well as legal precedents. Litigants and judges are seen as maximizers of rational utility, but they are also actors who pursue their self-interest in a discursive manner, through reasoning and analogous thinking, and enduring and precedent-based jurisprudence leads to results that are both indefinite and progressive: that is, they depend on the path. The paper concludes by addressing various implications of the argument, which, taken together, define a research agenda.