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Law and Psychology

Behavioral economics

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Full-Text Articles in Law

Nudge, Choice Architecture, And Libertarian Paternalism, Pierre Schlag Jan 2010

Nudge, Choice Architecture, And Libertarian Paternalism, Pierre Schlag

Articles

In Nudge, Cass Sunstein and Richard Thaler describe how public and private institutions can improve on individual choices by nudging individuals into making selections that are right for them. Rejecting the Econ-101 caricature of the rational utility maximizer as inaccurate, Sunstein and Thaler apply the insights of behavioral economics to show how institutions can improve the delivery of services. Moving beyond attempts to remedy individual cognitive errors, Sunstein and Thaler also argue for "libertarian paternalism" - which they herald as the "Third Way." This Review assesses their claims critically, finding their development of "nudge" and "choice architecture" to be welcome additions ...


How The New Economics Can Improve Employment Discrimination Law, And How Economics Can Survive The Demise Of The Rational Actor, Scott A. Moss, Peter H. Huang Jan 2009

How The New Economics Can Improve Employment Discrimination Law, And How Economics Can Survive The Demise Of The Rational Actor, Scott A. Moss, Peter H. Huang

Articles

Much employment discrimination law is premised on a purely money-focused "reasonable" employee, the sort who can be made whole with damages equal to lost wages, and who does not hesitate to challenge workplace discrimination. This type of "rational" actor populated older economic models but has been since modified by behavioral economics and research on happiness. Behavioral and traditional economists alike have analyzed broad employment policies, such as the wisdom of discrimination statutes, but the devil is in the details of employment law. On the critical damages-and-liability issues the Supreme Court and litigators face regularly, the law essentially ignores the lessons ...


Behavioral Economics And The Sec, Stephen J. Choi, Adam C. Pritchard Jan 2003

Behavioral Economics And The Sec, Stephen J. Choi, Adam C. Pritchard

Articles

Not all investors are rational. Quite apart from the obvious examples of credulity in the face of the latest Ponzi scheme, there is no shortage of evidence that many investors' decisions are influenced by systematic biases that impair their abilities to maximize their investment returns. For example, investors will often hold onto poorly performing stocks longer than warranted, hoping to recoup their losses. Other investors will engage in speculative trading, dissipating their returns by paying larger commissions than more passive investors. And we are not just talking about widows and orphans here. There is evidence that supposedly sophisticated institutional investors-mutual ...


Reasons Within Passions: Emotions And Intentions In Property Rights Bargaining, Peter H. Huang Jan 2000

Reasons Within Passions: Emotions And Intentions In Property Rights Bargaining, Peter H. Huang

Articles

This article discusses the role of emotions (or feelings or affects) in property rights bargaining. Real world people choose bargaining strategies based upon not only rational calculations, but also their gut feelings. This article considers the impact of anger and shame on bargaining over property rights and the Coase theorem. Such emotions may depend on beliefs (expectations or assessments) about whether particular strategic decisions should or will occur. Such beliefs can be viewed as attributions over the intentions of others.


Dangers Of Monetary Commensurability: A Psychological Game Model Of Contagion, Peter H. Huang Jan 1998

Dangers Of Monetary Commensurability: A Psychological Game Model Of Contagion, Peter H. Huang

Articles

No abstract provided.