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The Behavioural Turn in Law and Economics

Introduction

Introduction
Magdalena Małecka et Alain Marciano
p. 299-303

Texte intégral

1The birth of the Law and Economics movement is usually dated to the early 1960s and linked to the publication of “The Problem of Social Cost” (1960), written by Ronald Coase and of “Some Thoughts on the Distribution of Risks and Insurance” (1961), by Guido Calabresi. The latter, a legal scholar, was convinced that economics could help legal scholarship to answer some of the challenging questions about tort law (more precisely, about liability and accidents). However, Calabresi insisted that one of the assumptions made by economists—namely the assumption of individual rationality—should not be accepted within law and economics movement. Indeed, to him, any use of economics to analyze a legal problem should start from assuming that individuals are not rational. Or, to put it differently, he believed that no policy recommendation or judicial decision should be made on the basis of rationality assumption— “the whole ‘rational economic man’ approach strikes me as so unreal that I cannot fully believe that men as practical as judges could fully buy it” (Calabresi, 1961, 515).

2About forty years later, and almost twenty years ago, a quite similar claim was made by Cristine Jolls, Cass Sunstein and Richard Thaler in their seminal article: “A behavioural approach to law and economics” (1998). Their analysis was based on the findings of behavioral economics, an approach that challenged the behavioral assumption standardly used in economics and was believed to offer a “better understanding of human behavior” (1998, 1473).

  • 1 On Becker and law and economics, see Posner (1993) and Fleury (2015; 2016; 2017).
  • 2 On the history of this change see Harnay and Marciano (2009), and on the distinction between law an (...)

3At the same time, Jolls, Sunstein and Thaler noted that despite the fact that behavioral economics had become “relatively common” (Jolls et al., 1998, 1473) in economics, it had not affected law and economics. Indeed, since the early 1960s, law and economics had been turned into an economic analysis of law—by Gary Becker (1968)1, William Landes (1971) and Richard Posner (1973)2 —and the rationality assumption had become even more central than it was. To Jolls, Sunstein and Thaler, it was high time to use the findings of behavioural economics to improve law and economics. Thus their paper aimed at “proposing a systematic framework for a behavioral approach to economic analysis of law” (1998, 1473). Or, to put it in other words, they aimed at developing a new approach within the law and economics movement or even a new branch of law and economics—behavioral law and economics. Ultimately, did they write, “[w]e hope that this article will encourage others to continue the inquiry and research, both theoretical and empirical, that will be needed to flesh out the behavioral approach for which we have argued here.” (Jolls et al., 1998, 1547). Furthermore, Jolls, Sunstein and Thaler also hoped that

[t]hirty years from now, … there will be no such thing as behavioral economics. Instead we hope that economists and economically oriented lawyers will simply incorporate the useful findings of other social sciences, and in so doing, transform economics into behavioral economics, and economic analysis of law into one of its most important branches. (Jolls et al., 1998, 1547)

4Some of their hopes were fulfilled. Indeed, during the last twenty years, behavioral economics and behavioral law and economics rapidly developed and flourished. However, not as much as Jolls, Sunstein and Thaler would have wished. One can thus note that neither behavioral economics has replaced economics nor behavioral law and economics has replaced law and economics (or economic analysis of law). One cannot even say that law and economics has changed and incorporated the findings of behavioral economics. In particular, the assumption that individuals are self-interested and rational remains largely (dominantly) used in law and economics and economic analyses of the law. Up to the point that Guido Calabresi, in his newest book entitled The Future of Law and Economics (2016), insisted again on the need to adopt more realistic behavioral assumptions in law and economics and to use what he named the “amplified” approach in law and economics.

5We are still ten years away from the deadline of the prediction made by Jolls, Sunstein and Thaler and things can still change. But one may still wonder why, after twenty years law and economics has not given way to behavioral law and economics, as Jolls, Sunstein and Thaler and then Calabresi hoped it should be the case.

6One explanation could be that behavioral law and economics does not, after all and despite the claims of its promoters, sufficiently differ from the standard law and economics. The analyses developed there might seem different but they are not. And the conclusions drawn could be also found within the frame of standard law and economics. Thus, behavioral law and economics could be seen as a continuation of the traditional law and economics that was meant to bring (neoclassical) economics in order to study the behavioral impact of law. In other words, one may ask, to what extent and in which way does the behavioral law and economics differ from the neoclassical approach within law and economics? At least, we suggest, the question deserves to be raised.

7Contributions published in this special issue engage precisely with this question. They try to see if, how and how far, behavioral law and economics is a challenge to standard law and economics. They also show that providing an answer to this query is not as straightforward as it may seem at the first glance. In their reflection on behavioral law and economics, all authors employ a meta-perspective on the field, trying to understand what the behavioral turn in law and economics has been really about and what was its role, influence and importance for law and economics and, more generally, for studying law with the tools of other disciplines.

8Thus, in his paper, Mark White claims that the differences between the two approaches are not that important—especially in respect to the way in which people’s action is analyzed and conceptualized there. Thus, behavioral law and economics could not be that challenging, and the improvements brought to standard law and economics no more than marginal. For his part, Steven Sheffrin, argues that behavioral economics is a real challenge to standard economics—both approaches cannot be reconciled at all—but the challenge is not effective yet because behavioral law and economics is not as complete a research program as standard law and economics. This point is also noticed by Péter Cserne. He nonetheless adds other dimensions that should be taken into account while comparing the two approaches and he makes important and thought-provoking observations: Behavioral law and economics is useful in that it reveals standard law and economics’ weaknesses and the lines that divide the field. Fabrizio Esposito points out that in order to understand the role and importance of the behavioral turn in law and economics, one should in the first place acknowledge the heterogeneity of the law and economics movement—some schools that developed within it are more compatible with behavioral law and economics than others.

9Furthermore, all texts discuss the tensions and challenges that behavioral law and economics brought about and provoked. Almost all authors are concerned about the problem with the welfare criterion based on individual preferences that was endorsed by neoclassical economics and severely questioned by findings of behavioral economics and the behavioural sciences. In addition, Peter Cserne discusses the normative-positive divide in law and economics that challenges of the welfare criterion (for policy recommendations) have brought to the fore. Mark White points out that the behavioral law and economics, similarly to behavioral economics, doesn’t question the normative status of the expected utility theory. Peter Cserne suggests that this can be a manifestation of a dual, and hardly reconcilable, character of behavioral law economics—of being explanatory and policy-oriented project at the same time. For Steven Sheffrin another duality and irreconcilability are problematic—between neoclassical and behavioral law and economics. He provocatively claims that behavioral law and economics is subversive of neoclassical economic analysis of law.

10This does not imply that the authors who think that behavioral law and economics does indeed challenge standard law and economics endorse the former approach without criticism. Indeed, all texts discuss the limits that exist within behavioral law and economics and the tensions it brought about and provoked.

11The reader of this special issue will most probably be left with a feeling that behavioral law and economics does provoke serious questions about the nature and future of law and economics. We nevertheless hope that he/she will also have a more nuanced understanding of the behavioral turn in law and economics. Our aim was to challenge the received view on behavioral law and economics. The contributors to this special issue responded to our invitation in an intriguing, imaginative and at times provocative way. We believe that their interventions are important attempts of rethinking behavioral law and economics.

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Bibliographie

Becker, Gary S. 1968. Crime and Punishment: An Economic Approach. The Journal of Political Economy, 76(2): 169-217.

Calabresi, Guido. 1961. Some Thoughts on Risk Distribution and the Law of Torts. Yale Law Journal, 70(4): 499-553.

Calabresi, Guido. 2016. The Future of Law and Economics, New Haven: Yale University Press.

Coase, Ronald. 1960. The Problem of Social Cost. Journal of Law and Economics, 3: 1-44.

Fleury, Jean-Baptiste. 2015. Massive Influence with Scarce Contributions: the Rationalizing Economist Gary S. Becker, 1930-2014. European Journal of Law and Economics, 39(1): 3-9.

Fleury, Jean-Baptiste. 2016. Gary Becker. In A. Marciano and G. Ramello (eds), Encyclopedia of Law and Economics. New York: Springer. Online edition

Fleury, Jean-Baptiste. 2017. Crime and Punishment (Becker 1968). Encyclopedia of Law and Economics. New York: Springer. Online edition.

Jolls, Christine, Cass R. Sunstein and Richard Thaler. 1998. A Behavioral Approach to Law and Economics. Stanford Law Review, 50(5):1471-1550.

Landes, William M. 1971. An Economic Analysis of the Courts. Journal of Law and Economics, 14(1): 61-107.

Marciano, Alain. 2016. Economic Analysis of Law. Encyclopedia of Law and Economics. New York: Springer.

Posner, Richard A. [1973] 1986. Economic Analysis of Law. Boston and Toronto: Little, Brown and Company.

Posner, Richard A. 1993. Gary Becker's Contributions to Law and Economics. Journal of Legal Studies, 22(2): 211-215.

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Notes

1 On Becker and law and economics, see Posner (1993) and Fleury (2015; 2016; 2017).

2 On the history of this change see Harnay and Marciano (2009), and on the distinction between law and economics and an economic analysis of law, see Marciano (2016).

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Magdalena Małecka et Alain Marciano, « Introduction », Œconomia, 7-3 | 2017, 299-303.

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Magdalena Małecka et Alain Marciano, « Introduction », Œconomia [En ligne], 7-3 | 2017, mis en ligne le 01 septembre 2017, consulté le 11 décembre 2017. URL : http://journals.openedition.org/oeconomia/2769

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Auteurs

Magdalena Małecka

University of Helsinki, TINT, Academy of Finland, Centre of Excellence in the Philosophy of the Social Sciences

Alain Marciano

LAMETA, Université de Montpellier, Faculté d'Économie, Avenue Raymond Dugrand, CS 79606, F-34960 Montpellier cedex 2 France; alain.marciano@umontpellier.fr

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Les contenus d’Œconomia sont mis à disposition selon les termes de la Licence Creative Commons Attribution - Pas d'Utilisation Commerciale - Pas de Modification 4.0 International.

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