Category Archives: Law and Economics

Eyal Zamir, ‘Refounding Law and Economics: Behavioral Support for the Predictions of Standard Economic Analysis’

ABSTRACT Based on the premise that people are rational maximizers of their own utility, economic analysis has a fairly successful record in correctly predicting human behavior. This success is puzzling, given behavioral findings that show that people do not necessarily seek to maximize their own utility. Drawing on studies of motivated reasoning, self-serving biases, and […]

Govind Persad, ‘Risk, Everyday Intuitions, and the Institutional Value of Tort Law’

ABSTRACT This Note offers a normative critique of cost-benefit analysis, one informed by deontological moral theory, in the context of the debate over whether tort litigation or a non-tort approach is the appropriate response to mass harm. The first Part argues that the difference between lay and expert intuitions about risk and harm often reflects […]

Ignacio Cofone, ‘Nothing to hide, but something to lose’

ABSTRACT ‘I have nothing to hide’ is among the most common and controversial arguments against privacy. This article shows why the argument is mistaken on its own terms. To do so, it constructs a model combining the standard economic argument – that only people with ‘something to hide’ will value privacy – with a concept […]

Matthew Seligman, ‘Personalized Choice of Private Law’

ABSTRACT Personalized choice of private law is a new framework for designing the legal rules that govern transactions and interactions between private parties. It addresses a pervasive theoretical and practical problem in private law: Under modern commercial conditions, many people do not actually consent to important terms of their contracts and other interactions with firms. […]

‘Arrow’s Theorem’

Kenneth Arrow’s ‘impossibility’ theorem – or ‘general possibility’ theorem, as he called it – answers a very basic question in the theory of collective decision-making. Say there are some alternatives to choose among. They could be policies, public projects, candidates in an election, distributions of income and labour requirements among the members of a society, […]

Nicoletta Rangone, ‘Tools for Effective Law: A Focus on Nudge and Empowerment’

ABSTRACT Starting from the traditional deterrence approach, the paper analyses its more recent developments (as responsive and risk-based regulation) and emerging approaches, as ‘procedural justice’ and cognitive-based regulation and administration. These researches have enriched the list of compliance drivers, suggesting other possible motivations that go beyond the rational calculus, leading to an increasing in regulatory […]

Carol Rose, ‘Commons and Cognition’

ABSTRACT Garrett Hardin’s Tragedy of the Commons describes the cognitive state of a hypothetical herder on a common grassy field, who calculates that he will benefit most by grazing his stock in full while suffering only a fraction of the lost grass, but if other herders act similarly the field will be decimated. Hardin’s herder […]

Tontrup and Sprigman, ‘Experiments on Self-Nudging, Autonomy, and the Prospect of Behavioral-Self-Management’

ABSTRACT Strategies based in behavioral economics have quickly gained major importance in shaping public policy, most notably in the form of ‘nudges’ that promise to promote, but not to force, socially-productive choices at low cost. Nudging interventions typically presume some asymmetry of sophistication and power between the choice architect and the nudged. But the nudged […]

Candela and Geloso, ‘Coase and transaction costs reconsidered: the case of the English lighthouse system’

ABSTRACT What is Coase’s understanding of transaction costs in economic theory and history? Our argument in this paper is twofold, one theoretical and the other empirical. First, Coase regarded positive transaction costs as the beginning, not the end, of any analysis of market processes. From a Coasean perspective, positive transaction costs represent a profit opportunity […]

Barak Richman, ‘New Institutional Economics’

ABSTRACT This entry in the Oxford Handbook of New Private Law describes the parallels and mutual dialog between New Institutional Economics (NIE) and New Private Law (NPL). It observes that both fields share more than the word ‘new’ in their titles. NPL and NIE share methodological orientations; they share scholarly priorities; they have influenced each […]