1998/05/01 by Christine Jolls, Cass R. Sunstein, Richard H. Thaler · 2 citations
Economics, Econometrics and Finance · Decision Sciences · #Law, Economics, and Judicial Systems #Legal and Constitutional Studies #Decision-Making and Behavioral Economics
paper · doi:10.2307/1229304
openalex publication_date 1998/05/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/05
Economic analysis of law usually proceeds under the assumptions of neoclassical economics. But empirical evidence gives much reason to doubt these assumptions; people exhibit bounded rationality, bounded self-interest, and bounded willpower. This article offers a broad vision of how law and economics analysis may be improved by increased attention to insights about actual human behavior. It considers specific topics in the economic analysis of law and proposes new models and approaches for addressing these topics. The analysis of the article is organized into three categories: positive, prescriptive, and normative. Positive analysis of law concerns how agents behave in response to legal rules and how legal rules are shaped. Prescriptive analysis concerns what rules should be adopted to advance specified ends. Normative analysis attempts to assess more broadly the ends of the legal system: Should the system always respect people's choices? By drawing attention to cognitive and motivational problems of both citizens and government, behavioral law and economics offers answers distinct from those offered by the standard analysis.