Hostname: page-component-7c8c6479df-r7xzm Total loading time: 0 Render date: 2024-03-29T06:33:32.579Z Has data issue: false hasContentIssue false

Heterogeneity and law: toward a cognitive legal theory

Published online by Cambridge University Press:  14 September 2015

ANGELA AMBROSINO*
Affiliation:
Department of Economics and Statistics Cognetti deMartiis, University of Turin, Turin, Italy

Abstract

Since the 1990s, Sunstein, Jolls, and Thaler have questioned the perfect rationality assumption in law and economics (L&E) and introduced a behavioral approach. But Gregory Mitchell has criticized behavioral law and economics (BL&E). He argues that much of the scholarship within the field describes psychological research as if it provides general laws of thought and behavior rather than insights conditional on the setting, on the characteristics of subjects, and on the specificity of the task in hand. Human heterogeneity is not adequately included in models developed under behavioral assumptions of this kind. This paper argues that Mitchell's work contributes to develop a cognitive approach to Law closer to the cognitive theory of institutions and to the Original Institutional Economics (OIE). Mitchell's contextualist approach seeks to identify the specific conditions under which irrational behavior occurs and to understand when and how it can be remedied.

Type
Research Article
Copyright
Copyright © Millennium Economics Ltd 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Ambrosino, A. (2006), Verso una teoria cognitive delle istituzioni economiche, PhD Dissertation, Turin: University of Turin.Google Scholar
Ambrosino, A. (2012a), ‘Law and Economics e Economia Cognitiva’, in Rizzello, S. (ed.), (2011), Economia Cognitiva e Scienze Sociali, Torino: Giappichelli.Google Scholar
Ambrosino, A. (2012b), ‘Cognizione ed Evoluzione Istituzionale: Un Importante Punto di Contatto tra la Teoria del Cambiamento Istituzionale di Veblen e Hayek’, Studi e Note in Economia, 2: 219247.Google Scholar
Ambrosino, A. (2013), ‘Institutions as Outcomes of Games: Toward a Cognitive-Experimental Inquiry’, International Journal of Management, Economics and Social Sciences, 2 (2): 129150.Google Scholar
Ambrosino, A. (2014), ‘A Cognitive Approach to Law and Economics: Hayek's Legacy’, Journal of Economic Issues, 48 (1): 1949.Google Scholar
Ambrosino, A. and Lanteri, A. (2007), ‘Learning and the Emergence of Behavioural Rules in a Bargaining Game’, Journal of Social Complexity, 3 (1): 5372.Google Scholar
Anderson, K. L. (1933), ‘The Unity of Veblen's Theoretical System’, The Quarterly Journal of Economics, 47 (4): 598626.CrossRefGoogle Scholar
Anderson, C. A., Lindsay, J. J., and Bushman, B. J. (1999), ‘Research in the Psychological Laboratory; Truth or Triviality?’, Current Directions in Psychological Science, 8 (1): 39.CrossRefGoogle Scholar
Ayres, C. E. (1961), Toward a Reasonable Society, Austin: University of Texas Press.Google Scholar
Ayres, I. (2001), Pervasive Prejudice? Unconventional Evidence of Race And Gender Discrimination, Chicago: University of Chicago Press.Google Scholar
Bandura, A. (1977), Social Learning Theory, Englewood Cliffs, NJ: Prentice Hall.Google Scholar
Bourgine, P. and Nadal, J. P. (eds.) (2004), Cognitive Economics: An Interdisciplinary Approach, London: Springer.CrossRefGoogle Scholar
Brown, C. (2007), ‘Financial Engineering, Consumer Credit, and the Stability of Effective Demand’, Journal of Post Keynesian Economics, 29 (3): 429455.CrossRefGoogle Scholar
Calabresi, G. (1961), ‘Some Thoughts on Risk Distribution and the Law of Torts’, Yale Law Journal, 70 (4): 499553.Google Scholar
Camerer, C. (1995), ‘Individual Decision Making’, in Kagel and Roth (eds.), The Handbook of Experimental Economics, Princeton: Princeton University Press.Google Scholar
Camerer, C. (2007), ‘Neuroeconomics: Using Neuroscience to Make Economic Predictions’, The Economic Journal, 117 (519): c26c42.Google Scholar
Camerer, C. (2008), ‘The Potential of Neuroeconomics’, Economics and Psychology, 24 (3): 369379.Google Scholar
Camerer, C., Loewenstein, G., and Prelec, D. (2005), ‘Neuroeconomics: How Neuroscience can Inform Economics’, Journal o Economic Literature, 43 (1): 964.CrossRefGoogle Scholar
Coase, R. H. (1960), ‘The Problem of Social Cost’, Journal of Law and Economics, 3 (October): 144.Google Scholar
Cooter, R. and Ulen, T. (2000), Law and Economics, 3rd ed., Reading, MA: Addison Wesley Longman.Google Scholar
Davis, J. B. (2013), ‘Economics Imperialism under the Impact of Psychology: The Case of Behavioral Development Economics’, Oeconomia, 1 (March): 119138.Google Scholar
Dawson, R. (1998), ‘Sovereignty and Withholding in John Commons's Political Economy’, in Samuels, W. J. (ed.), The Founding of Institutional Economics: The Leisure Class And Sovereignty, New York: Routledge, pp. 4774.Google Scholar
Denzau, A. T. and North, D. (1994), ‘Shared Mental Models: Ideologies and Institutions’, Kyklos, 47 (1): 331.Google Scholar
Egidi, M. and Rizzello, S. (2004), ‘Cognitive Economics: Foundations and Historical Roots’, in Egidi, M. and Rizzello, S. (eds.), Cognitive Economics, Cheltenham Northampton, MA: Elgar, pp. 122.Google Scholar
Ellickson, R. C. (1989), ‘Bringing Culture and Human Frailty to Rational Actors: A Critique of Classical Law and Economics’, Chicago Kent Law Rev, 65 (1): 2355.Google Scholar
Evans, J. (2008), ‘Dual-Processing Accounts of Reasoning, Judgment and Social Cognition’, Annual Review of Psychology, 59 (January): 255278.Google Scholar
Fiske, A., Kitayama, S., Markus, H., and Nisbett, R. (1998), ‘The Cultural matrix of Social Psychology’, in Handbook of Social Psychology, New York: Mac Graw-Hill, vol. 2: pp. 951981.Google Scholar
Fiske, A. and Taylor, S. (1984), Social Cognition, New York: Random House.Google Scholar
Fiske, S. T. and Borgida, E. (1999), ‘Social Framework Analysis as Expert Testimony in Sexual harassment Suits’, in Estreicher, S. (ed.), Sexual Harassment in the Workplace: Proceedings of New York University 51st Annual Conference on Labor, Boston: Kluwer Law International, pp. 575577.Google Scholar
Fontana, M. (2010), ‘Can Neoclassical Economics Handle Complexity? The Fallacy of the Oil Spot Dynamic’, Journal of Economic Behavior and Organization, 76 (3): 584596.Google Scholar
Frischmann, B. M. and Marciano, A. (2014), ‘Understanding the Problem of Social Cost’, Journal of Institutional Economics, 11 (2): 329352.CrossRefGoogle Scholar
Gigerenzer, G (2014), Risk Savvy: How to Make Good Decisions, New York: Penguin Books.Google Scholar
Glimcher, P. W., Camerer, C. F., Fher, E., and Poldrack, R. A. (2009), Decision Making and the Brain, London: Elsevier.Google Scholar
Guthrie, C., Rachlinski, J. J., and Wistrich, A. J. (2001), ‘Inside the Judicial Mind’, Cornell Law Review, 86 (4): 777830.Google Scholar
Hamilton Krieger, L. (1995), ‘The Content of Our Categories: A Cognitive Bias Approach to Discrimination and Equal Employment Opportunity’, Stanford Law Review, 47 (July): 1161.Google Scholar
Hamilton, R. M. (2000), ‘The Limits of Behavioral Decision Theory in Legal Analysis: The Case of Liquidated Damages’, Cornell Law Review, 85: 717739.Google Scholar
Hayek, F. A. (1952), The Sensory Order, Chicago: Chicago University Press.Google Scholar
Hayek, F. A. (1960), The Constitution of Liberty, Chicago: Chicago University Press.Google Scholar
Hayek, F. A. (1962), ‘Rules Perception and Intelligibility’, in Hayek, F. A. (ed.) (1967), Studies in Philosophy, Politics and Economics, Chicago: Chicago University Press.Google Scholar
Hayek, F. A. (1982), Law, Legislation and Liberty, London: Routledge.Google Scholar
Hayek, F. A. (1988), The Fatal Conceit. The Errors of Socialism, London: Routledge.Google Scholar
Hodgson, G. (1998), ‘On the Evolution of Thorstein Veblen's Evolutionary Economics’, Cambridge Journal of Economics, 22 (4): 415431.Google Scholar
Hodgson, G. (2002), ‘The Evolution of Institutions: An Agenda for Future Theoretical Research’, Constitutional Political Economy, 13 (2): 111127.Google Scholar
Hodgson, G. (2003), ‘The Hidden Persuaders: Institutions and Individuals in Economic Theory’, Cambridge Journal of Economics, 27 (2): 159175.CrossRefGoogle Scholar
Hodgson, G. M. (2004), ‘Reclaiming Habit for Institutional Economics’, Journal of Economic Psychology, 25 (4): 651660.Google Scholar
Hodgson, G. M. (2006), ‘What are institutions’, Journal of Economic Issues, 40 (1): 125.Google Scholar
Hodgson, G. M. (ed.) (2007), The Evolution of Economic Institutions, London: Elsevier.Google Scholar
Hodgson, G. (2014), ‘On Fuzzy Frontiers and Fragmented Foundations: Some Reflections on the Original and New institutional Economics’, Journal of Institutional Economics, 10 (4): 591611.Google Scholar
Hodgson, G. and Stoelhorst, J. W. (2014), ‘Introduction to the Special Issue on the Future of Institutional and Evolutionary Economics’, Journal of Institutional Economics, 10 (4): 513540.CrossRefGoogle Scholar
Hoffman, E. and Spitzer, M. (1982), ‘The Coase Theorem: Some Experimental Tests’, Journal of Law and Economics, 25 (1): 7398.Google Scholar
Holmes, O. W. (1894), ‘Privilege, Malice, and Intent’, Harvard Law Review, 8 (1): 112.Google Scholar
Ioannidis, J. P. A. (2008), ‘Why most Discovered True Associations are Inflated’, Epidemiology, 19 (5): 640648.Google Scholar
Jensen, H. E. (1987), ‘The Theory of Human Nature’, Journal of Economic Issues, 21 (3): 10391073.Google Scholar
Jolls, C. (2007), ‘Behavioral Law and Economics’, in Diamond, P. (ed.), (2007), Economic Institutions and Behavioral Economics, Princeton: Princeton University Press.Google Scholar
Jolls, C. and Sunstein, C. R. (2006), ‘Debiasing Through Law’, Journal of Legal Studies, 35 (January): 199241.Google Scholar
Jolls, C., Sunstein, C. R., and Thaler, R. (1998), ‘A Behavioral approach to Law and Economics’, Stanford Law Review, 50 (May): 14711552.CrossRefGoogle Scholar
Jones, O. D. (2001), ‘Time Shifted Rationality and the Law of Law's Leverage: Behavioral Economics Meets Behavioral Biology’, Northwestern University Law Review, 95 (4): 11411154.Google Scholar
Kahneman, D. (1994), ‘New Challenges to the Rationality Assumption’, Journal of Institutional and Theoretical Economics, 150 (1): 1836.Google Scholar
Kahneman, D. and Frederick, S. (2002), ‘Representativeness Revisited: Attribute Substitution in Intuitive Judgment’, in Gilovich, T.et al. (eds.), Heuristics & Biases: The Psychology of Intuitive Judgment, Cambridge: Cambridge University Press.Google Scholar
Kahneman, D. and Tversky, A. (1982), ‘On the Study of Statistical Institutions’, Cognition, 11 (2): 123125.Google Scholar
Kelman, M. (1983), ‘Misunderstanding Social Life: A Critique of the Core Premises of Law and Economics’, Journal of Legal Education, 33: 274284.Google Scholar
Kennedy, D. (1981), ‘Cost-Benefit Analysis of Entitlement Problems: a Critique’, Stanford Law Review, 33 (3): 387445.Google Scholar
Korobkin, R. B. and Ulen, T. S. (2000), ‘Law and Behavioral Science: Removing the Rationality Assumption from Law and Economics’, California Law Review, 88 (4): 10511144.Google Scholar
Loewenstein, G., Issachroff, C., Camerer, C., and Babcock, L. (1993), ‘Self-serving Assessments of Fairness and pre.Trial Bargaining’, Journal of legal Studies, 22 (1): 135159.CrossRefGoogle Scholar
Loires, G. (1998), ‘From Social Cognition to Metacognition’, in Yzerbyt, V. Y., Loires, G. and Dardenne, B. (eds.), Metacognition: Cognitive and Social Dimensions (pp. 115). London: Sage.Google Scholar
McFadden, D. (1999), ‘Rationality for Economists?’, Journal of Risk and Uncertainty, 19 (1–3): 73105.Google Scholar
Merlo, A. and Schotter, A. (1999), ‘A Surprise-Quiz View of Learning in Economic Experiments’, Games and Economic Behavior, 28 (1): 2554.Google Scholar
Michelman, F. I. (1983), ‘Reflections on Professional Education, Legal Scholarship, and the and Economics Movement’, Journal of Legal Education, 33 (2): 197227.Google Scholar
Mitchell, G. (2002a), ‘Why Law and Economics’ Perfect Rationality Should not be Traded for Behavioral Law and Economics’ Equal Incompetence’, Georgetown Law Journal, 91 (1): 67167.Google Scholar
Mitchell, G. (2002b), ‘Thinking Behavioralism too Seriously? The Unwarranted Pessimism of the New Behavioral Analysis of Law’, William and Mery Law Review, 43 (5): 19072021.Google Scholar
Mitchell, G. (2003a), ‘Tendencies Versus Boundaries: Levels of Generality in Behavioral Law and Economics’, Vanderbilt Law Review, 56 (6): 17811812.Google Scholar
Mitchell, G. (2003b), ‘Mapping Evidence Law’, Michigan State Law Review, 2 (1): 10651148.Google Scholar
Mitchell, G. (2004), ‘Case Studies, Counterfactuals, and Causal Explanations’, University of Pennsylvania Law Review, 152 (5): 15171608.Google Scholar
Mitchell, G. (2005), ‘Libertarian Paternalism is an Oxymoron’, Northwestern University Law Review, 99 (3): 12451277.Google Scholar
Mitchell, G. (2009), ‘Second Thoughts’, McGeorge Law Review, 40 (3): 687722.Google Scholar
Mitchell, G. (2010), ‘Good Causes and Bad Science’, Vanderbilt Law Review Banc Roundtable, 63 (1): 133147.Google Scholar
Mitchell, G. (2012), ‘Revisiting Truth Or Triviality: The External Validity of Research in the Psychological Laboratory’, Perspective on Psychological Science, 7 (2): 109117.Google Scholar
Mitchell, G., Monahan, L., and Walker, L. (2011), ‘Case- Specific Sociological Inference: Meta-Norms for Expert Opinions’, Sociological Methods and Research, 40 (4): 668680.Google Scholar
Mitchell, G., Walker, L., and Monahan, L. (2010), ‘Beyond Context: Social Facts as Case- Specific Evidence’, Emory Law Review, 4 (6): 11101155.Google Scholar
Monahan, J., Walker, L., and Mitchell, G. (2009), ‘The limits of Social Framework Evidence’, Law, Probability and Risk, 8 (4): 307321.CrossRefGoogle Scholar
Nagel, T. (1979), Mortal Questions, Cambridge: Cambridge University Press.Google Scholar
Nisbett, R. (2003), The Geography of Thought: How Asian and Westerners Think Differently and Why, London: The Free Press.Google Scholar
North, D. (1990), Institutions, Institutional Change and Economic Performance, Cambridge: Cambridge University Press.CrossRefGoogle Scholar
North, D. (1991), ‘Institutions’, Journal of Economic Perspectives, 5 (1): 97102.Google Scholar
North, D. (1994), ‘Economic Performance Through Time’, American Economic Review, 84 (3): 359368.Google Scholar
North, D. (2005), Understanding the Process of Economic Change, Princeton: Princeton University Press.Google Scholar
Pagano, U. and Vatiero, M. (2014), ‘Costly Institutions as Substitutes: Novelty and Limits of the Coasian Approach’, Journal of Institutional Economics, 11 (2): 265281.Google Scholar
Petty, R. and Brinol, P. (eds.) (2008), Attitudes: Insights from the New Implicit Measures, New York: Psychology Press.Google Scholar
Posner, R. A. (1973), Economic Analysis of Law, New York: Little, Brown & Company.Google Scholar
Posner, R. A. (1983), The Economics of Justice, Cambridge MA: Harvard University Press.Google Scholar
Rachlinski, J. J. (1998), ‘A Positive Psychological Theory of Judging in Hindsight’, University of Chicago Law Review, 65 (2): 571625.Google Scholar
Rachlinski, J. J. (2000), ‘The “New” Law and Psychology: A Reply to Critics, Skeptics, and Cautious Supporters’, Cornell Review, 85 (3): 739766.Google Scholar
Rizzello, S. (ed.) (2003), Cognitive Developments in Economics, London; New York, N.Y: Routledge.Google Scholar
Rizzello, S. and Turvani, M. (2000), ‘Institution Meet Mind: The Way out of an Impasse’, Constitutional Political Economy, 11 (2): 165180.Google Scholar
Rizzello, S. and Turvani, M. (2002), ‘Subjective Diversity and Social Learning: A Cognitive Perspective for Understanding Institutional Behavior’, Constitutional Political Economy, 13 (3): 201214.Google Scholar
Roe, M. and Vatiero, M. (2015), ‘Corporate Governance and Its Political Economy’, available at SSRN: http://ssrn.com/abstract=2588760 (accessed 24 may 2015).Google Scholar
Rosenthal, R. (1979), ‘The File Drawer Problem and Tolerance for Null Results’, Psychological Bulletin, 86 (3): 638641.Google Scholar
Rowley, C. (1989), ‘Public Choice and the Economic analysis of Law’, Law and Economics: Recent Economic Thought Series, 19 (1): 123173.Google Scholar
Rutherford, M. (2001), ‘Institutional Economics: Then and Now’, The journal of Economic Perspective, 15 (3): 173194.Google Scholar
Schelling, T. C. (1960), The Strategy of Conflict, Cambridge, MA: Harvard University Press.Google Scholar
Schotter, A. (1981), The Economic Theory of Social Institutions, Cambridge: Cambridge University Press.Google Scholar
Simmons, J. P., Nelson, L. D., and Simonsohn, U. (2011), ‘False- Positive Psychology: Undisclosed Flexibility in Data Collection and Analysis allows Presenting Anything as Significant’, Psychological Science, 22 (11): 13591366.CrossRefGoogle ScholarPubMed
Simon, H. (1997), Models of Bounded Rationality, Cambridge MA: MIT Press.Google Scholar
Sunstein, C. (ed.) (2000), Behavioral Law and Economics, Cambridge: Cambridge University Press.Google Scholar
Sunstein, C. (2002), Risk and Reason, Cambridge: Cambridge University Press.Google Scholar
Sunstein, C. and Thaler, R. (2003), ‘Libertarian Paternalism is not an Oxymoron’, University of Chicago Law Review, 70 (4): 11591202.Google Scholar
Tversky, A. and Kahneman, D. (1974), ‘Judgment under Uncertainty: Heuristics and Biases’, Science, 185 (4157): 11241131.Google Scholar
Tversky, A. and Kahneman, D. (1981), ‘The Framing of Decision and Psychology of Choice’, Science, 211 (4881): 453458.Google Scholar
Veblen, T. (1898), ‘Why is Economics not an Evolutionary Science’, Quarterly Journal of Economics, 12 (4): 373397.Google Scholar
Vromen, J. J. (1995), Economic Evolution, London: Routledge.Google Scholar
Vromen, J. J. (2013), ‘Competition as Evolutionary Process: Mark Blaug and Evolutionary Economics’, Erasmus Journal of Philosophy and Economics, 6 (3): 104132.Google Scholar
Walliser, B. (2008), Cognitive Economics, Verlag Berlin Heidelberg: Springer.Google Scholar
Williamson, O. E. (2000), ‘The New Institutional Economics: Taking Stock, Looking Ahead’, Journal of Economic Literature, 38 (3): 595613.Google Scholar
Worthington, D., Stallard, M. J., Price, J. M., and Goss, P. J. (2002), ‘Hindsight Bias, Daubert, and the Silicone Breast Implant Litigation’, Psychology, Public Policy, and Law, 8 (2): 154179.CrossRefGoogle Scholar