The law shapes politics, economics, history and society in many ways. It serves four basic purposes: establishing standards, maintaining order, resolving disputes and protecting liberties and rights. Its precise definition is a subject of longstanding debate and its application has often been controversial.
A general distinction can be drawn between civil law jurisdictions, where a legislature or other central body codifies and consolidates their laws, and common law systems, where judges’ decisions are binding precedent. However, the distinction is not rigid and common law systems have developed a large body of case law through the centuries. In many countries, civil and common law coexist.
Unlike normative statements in other sciences and disciplines (such as the law of gravity), a statement in law is prescriptive, dictating how people ought to behave or what they must or may not do under certain conditions. This characteristic makes legal statements more complex from a methodological perspective than those in empirical science (such as the law of supply and demand) or social sciences (such as the law of cause and effect).
The law can be divided into several distinct areas. Labour law, for example, deals with the tripartite industrial relationship between employers, workers and trade unions. Family law is concerned with marriage and divorce, child custody and property rights. Tax law concerns rules on value added tax, corporation tax and income tax. Banking law covers regulations on lending and capital investment. Commercial law covers rules on contracts and business transactions.