Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 2 of 2
Full-Text Articles in Law
Doing What You Say, Robert D. Cooter
Doing What You Say, Robert D. Cooter
Robert Cooter
Making wealth requires people to do what they say. In relationships and repeat transactions, reciprocity makes people do what they say, even without contract law. Relationships and repeat transactions, however, preclude competition. Competition involving transactions with strangers invigorates an economy and enables it to flourish. Making strangers do what they say requires them to commit legally. According to the contract principle for economic cooperation, the law should enable people to commit to doing what they say. When this principle is implemented, strangers can trust each other enough to work together even when money is at stake. Implementing this principle requires …
The Misperception Of Norms: The Psychology Of Bias And The Economics Of Equilibrium, Robert D. Cooter, Mical Feldman, Yuval Feldman
The Misperception Of Norms: The Psychology Of Bias And The Economics Of Equilibrium, Robert D. Cooter, Mical Feldman, Yuval Feldman
Robert Cooter
This study combines the psychology of bias and the economics of equilibrium. We focus on two of the most discussed perceptual biases found by psychologists who studied the role social norms in ethical decision making. First, psychologists found a general tendency of people to over-estimate how many other people engage in unethical behavior. We show that this bias causes more people to violate the norm than if the bias were corrected. Second, psychologists found a general tendency of a person to over-estimate how many other people act the same as he does. We show that this bias does not change …