Behavioral Law & Economics
Prof. Dr. Gerd MühlheußerVeranstaltung
Mitteilungen
Liebe Teilnehmerinnen und Teilnehmer des Kurses "Behavioral Law & Economics",
die Uhrzeiten für den GS-Kurs "Behavioral Law & Economics" (Prof. Mühlheußer) wurden noch ein wenig verändert.
Die neuen Uhrzeiten:
Do., 26.01.17, 09:00-17:00 Uhr
Fr., 27.01.17, 09:00-17:00 Uhr
Mit freundlichen Grüßen
Ulf Beckmann, Graduate School
Beschreibung
Date and Time: January 26/27, 2017
Outline: The block course is paper-based and taught in English. It builds on recent
developments in the area of behavioral economics (both theoretical and experimental)
and discusses applications in classical fields of Law & Economics such as torts, contracts,
litigation and law enforcement. Each session is centered around one or two papers on
the reading list (indicated in bold face).
Background Reading: A good general introduction to behavioral Economics is Angner
(2016). As for applications of these concepts and methods to Law & Economics, good
starting points are the book by Sunstein (2000), the surveys by Jolls et al. (1998),
Camerer and Talley (2007), Arlen and Talley (2008), and the forthcoming collected
volume Zeiler and Teitelbaum (2017). Levitt and List (2007) and Falk and Heckman
(2009) provide a general discussion of the pros and cons of using experiments in economic
research, while Croson (2002) provides a primer for the legal arena. See Moffatt (2015)
for an empirical methods for experiments in economics.
Prerequisites: Solid knowledge of microeconomics, game theory and microeconometrics,
familiarity with crucial concepts of behavioral and experimental economics.
Assessment: Participants are required to write an academic referee report on one of the
(non-survey) papers of their choice on the reading list (Deadline March 15, 2017).
Syllabus
1 Introduction: A Primer on Behavioral Economics
- Overview over some systematic deviations from the predicted behavior under the
homo oeconomicus paradigm.
- Background reading: Angner (2016)
2 Biases in Bilateral Bargaining
2.1 Endowment Effects and the Coase-Theorem
- Theory: Coase (1960)
- Experiment: Kahneman et al. (1990), Hoffman and Spitzer (1982)
Background reading: Zeiler (2016), Horowitz and McConnell (2002)
2.2 Impasse in Settlement Negotiations
- Theory:
- Basic models with differing perceptions: Shavell (1982), Priest and Klein (1984)
- Seminal models of asymmetric information: Bebchuk (1984) (screening) and Reinganum and Wilde (1986) (signaling)
- Combining asymmetric information and self-serving bias: Farmer and Pecorino (2002)
- Differences in evaluating gains and losses (reference-point dependent preferences): Kahneman and Tversky (1979) (Prospect Theory), Köszegi and Rabin (2006) (endogenous reference points)
- Experimental Studies:
- Self-Serving Bias: Babcock et al. (1995), Loewenstein et al. (1993)
- Framing: Guthrie et al. (2001), Rachlinski (1996)
- More stuff : Landeo et al. (2007a) (split-awards), Landeo et al. (2007b) (court errors), Babcock and Pogarsky (1999), Pogarsky and Babcock (2001) (damage caps), Massenot et al. (2016) (American versus English rule)
- Background reading: Landeo (2014), Babcock and Loewenstein (1997), Camerer and Talley (2007)
3 Contracts
3.1 Incentive Effects of Breach Remedies
- Theory: Shavell (1980), Rogerson (1984), Shavell (1984)
- Experiments: Sloof et al. (2003), Sloof et al. (2006)
3.2 Contracts as Rent-Seeking Devices
3.2.1 Breach Penalties and the Role of Renegotiation
- Theory: Aghion and Bolton (1987), Spier and Whinston (1995)
- Empirical Evidence: Landeo and Spier (2016), Feess, Gern, and Muehlheusser (2015)
- More stuff : Hart and Moore (2008); Fehr, Zehnder, and Hart (2009); Fehr, Hart,and Zehnder (2011, 2015) (contracts as reference points)
3.2.2 Exclusive Dealing Provisions
- Theory: Rasmusen, Ramseyer, and Wiley (1991), Segal and Whinston (2000)
- Experiments: Landeo and Spier (2009), Smith (2011), Boone, Muller, and Suetens 2014)
- Background reading: Landeo (2015)
4 Intrinsic Motivation and the Enforcement of Law and Norms
4.1 Delegated Enforcement
- Buechel and Muehlheusser (2016), Polinsky (1980), Cosgel et al. (2011)
- Background reading: Becker (1968)
4.2 Fines and Intrinsic Motivation
- Gneezy and Rustichini (2000a), Gneezy and Rustichini (2000b)
- Background reading: Gneezy, Meier, and Rey-Biel (2011), Frey and Jegen (2001)
References
Aghion, P. and P. Bolton (1987): "Contracts as a Barrier to Entry," American
Economic Review, 77, 388-401.
Angner, E. (2016): A Course in Behavioral Economics (2nd edition), Palgrave Macmillan.
Arlen, J. and E. L. Talley (2008): "Experimental law and economics," New York
University Law and Economics Working Paper No. 8-1-2008.
Babcock, L. and G. Loewenstein (1997): "Explaining bargaining impasse: The
role of self-serving biases," The Journal of Economic Perspectives, 11, 109-126.
Babcock, L., G. Loewenstein, S. Issacharoff, and C. Camerer (1995): "Biased
judgments of fairness in bargaining," The American Economic Review, 85, 1337-
1343.
Babcock, L. and G. Pogarsky (1999): "Damage Caps and Settlement: A Behavioral
Approach," The Journal of Legal Studies, 28, 341-370.
Bebchuk, L. A. (1984): "Litigation and settlement under imperfect information," The
RAND Journal of Economics, 404-415.
Becker, G. (1968): "Crime and Punishment: An Economic Approach," Journal of
Political Economy, 76, 169-217.
Boone, J., W. Muller, and S. Suetens (2014): "Naked exclusion in the lab: The
case of sequential contracting," The Journal of Industrial Economics, 62, 137-166.
Buechel, B. and G. Muehlheusser (2016): "Black Sheep or Scapegoats? Implementable
Monitoring Policies under Unobservable Levels of Misbehavior," The Journal
of Legal Studies, 45, 331-366.
Camerer, C. and E. Talley (2007): "Experimental Study of Law," in Handbook of
Law and Economics, ed. by A. M. Polinsky and S. Shavell, Elsevier, vol. 2, 1619-1650.
Coase, R. H. (1960): "The Problem of Social Cost," Journal of Law and Economics,
3, 1-44.
Cosgel, M. M., H. Etkes, and T. J. Miceli (2011): "Private Law Enforcement,
Fine Sharing, and Tax Collection: Theory and Historical Evidence," Journal of Eco-
nomic Behavior & Organization, 80, 546-552.
Croson, R. (2002): "Why and How to Experiment: Methodologies From Experimental
Economics," University of Illinois Law Review, 921-945.
Falk, A. and J. J. Heckman (2009): "Lab experiments are a major source of knowledge
in the social sciences," Science, 326, 535-538.
Farmer, A. and P. Pecorino (2002): "Pretrial bargaining with self-serving bias and
asymmetric information," Journal of Economic Behavior & Organization, 48, 163-176.
Feess, E., M. Gerfin, and G. Muehlheusser (2015): "Contracts as Rent Seeking
Devices: Evidence from German Soccer," Economic Inquiry, 53, 714-730.
Fehr, E., O. Hart, and C. Zehnder (2011): "Contracts as Reference Points -
Experimental Evidence," The American Economic Review, 101, 493-525.
------- (2015): "How Do Informal Agreements and Revision Shape Contractual Reference
Points?" Journal of the European Economic Association, 13, 1-28.
Fehr, E., C. Zehnder, and O. Hart (2009): "Contracts, Reference points, and
Competition Behavioral Effects of the Fundamental Transformation," Journal of the
European Economic Association, 7, 561-572.
Frey, B. and R. Jegen (2001): "Motivation Crowding Theory," Journal of Economic
Surveys, 15, 589-611.
Gneezy, U., S. Meier, and P. Rey-Biel (2011): "When and Why Incentives (Don't)
Work to Modify Behavior," Journal of Economic Perspectives, 25, 191-209.
Gneezy, U. and A. Rustichini (2000a): "Fine Is a Price," Journal of Legal Studies,
29, 1-17.
--------- (2000b): "Pay enough or do not pay at all," Quarterly Journal of Economics,
115, 791-810.
Guthrie, C., J. J. Rachlinski, and A. J. Wistrich (2001): "Inside the Judicial
Mind," Cornell Law Review, 86, 777-830.
Hart, O. and J. Moore (2008): "Contracts as Reference Points," The Quarterly
Journal of Economics, 123, 1-48.
Hoffman, E. and M. L. Spitzer (1982): "The Coase Theorem: Some Experimental
Tests," The Journal of Law & Economics, 25, 73-98.
Horowitz, J. K. and K. E. McConnell (2002): "A Review of WTA/WTP Studies,"
Journal of Environmental Economics and Management, 44, 426-447.
Jolls, C., C. R. Sunstein, and R. Thaler (1998): "A behavioral approach to law
and economics," Stanford Law Review, 1471-1550.
Kahneman, D., J. L. Knetsch, and R. H. Thaler (1990): "Experimental Tests
of the Endowment Effect and the Coase Theorem," Journal of Political Economy,
1325-1348.
Kahneman, D. and A. Tversky (1979): "Prospect Theory: An Analysis of Decision
Under Risk," Econometrica, 263-291.
Köszegi, B. and M. Rabin (2006): " Model of Reference-Dependent Preferences,"
The Quarterly Journal of Economics, 1133-1165.
Landeo, C. M. (2014): "Law and Economics and Tort Litigation Institutions: Theory
and Experiments," in The Research Handbook on Behavioral Law and Economics,
Forthcoming, ed. by K. Zeiler and J. Teitelbaum, Edward Elgar Publishing.
------ (2015): "Exclusionary Vertical Restraints and Antitrust: Experimental Law and
Economics Contributions," in Research Handbook on Behavioral Law and Economics,
ed. by K. Zeiler and J. Teitelbaum, Edward Elgar Publishing.
Landeo, C. M., M. Nikitin, and L. Babcock (2007a): "Split-awards and disputes:
An experimental study of a strategic model of litigation," Journal of Economic
Behavior & Organization, 63, 553-572.
Landeo, C. M., M. Nikitin, and S. Baker (2007b): "Deterrence, lawsuits, and
litigation outcomes under court errors," Journal of Law, Economics, & Organization,
23, 57-97.
Landeo, C. M. and K. E. Spier (2009): "Naked exclusion: an experimental study
of contracts with externalities," The American Economic Review, 99, 1850-1877.
------ (2016): "Stipulated Damages as a Rent-Extraction Mechanism: Experimental
Evidence," Journal of Institutional and Theoretical Economics (JITE), 172, 235-273.
Levitt, S. D. and J. A. List (2007): "What do laboratory experiments measuring
social preferences reveal about the real world?" The Journal of Economic Perspectives,
21, 153-174.
Loewenstein, G., S. Issacharoff, C. Camerer, and L. Babcock (1993): "Selfserving
assessments of fairness and pretrial bargaining," The Journal of Legal Studies,
22, 135-159.
Massenot, B., M. Maraki, and C. Thoeni (2016): "Legal Compliance and Litigation
Spending Under the English and American rule: Experimental Evidence,"
Universite de Lausanne, mimeo.
Moffatt, P. G. (2015): Experimetrics: Econometrics for Experimental Economics,
Palgrave Macmillan.
Pogarsky, G. and L. Babcock (2001): "Damage Caps, Motivated Anchoring, and
Bargaining Impasse," The Journal of Legal Studies, 30, 143-159.
Polinsky, A. M. (1980): "Private Versus Public Enforcement of Fines," Journal of
Legal Studies, 9, 105-127.
Priest, G. and B. Klein (1984): "The Selection of Disputes for Litigation," The
Journal of Legal Studies, 13, 1-55.
Rachlinski, J. J. (1996): "Gains, Losses, and the Psychology of Litigation," Southern
California Law Review, 70, 113-185.
Rasmusen, E., M. Ramseyer, and J. Wiley (1991): "Naked Exclusion," American
Economic Review, 81, 1137-1145.
Reinganum, J. F. and L. L. Wilde (1986): "Settlement, litigation, and the allocation
of litigation costs," The RAND Journal of Economics, 557-566.
Rogerson, W. P. (1984): \Ecient Reliance and Damage Measures for Breach of
Contract," RAND Journal of Economics, 15, 37-53.
Segal, I. and M. Whinston (2000): "Naked Exclusion: Comment," American Eco-
nomic Review, 90, 296-309.
Shavell, S. (1980): "Damage Measures for Breach of Contract," Bell Journal of Eco-
nomics, 11, 466-490.
------ (1982): "Suit, Settlement, and Trial," Journal of Legal Studies, 11, 55{81.
------- (1984): "The Design of Contracts and Remedies for Breach," Quarterly Journal
of Economics, 94, 121-148.
Sloof, R., E. Leuven, H. Oosterbeek, and J. Sonnemans (2003): "An Experimental
Comparison of Reliance Levels under Alternative Breach Remedies," RAND
Journal of Economics, 205-222.
Sloof, R., H. Oosterbeek, A. Riedl, and J. Sonnemans (2006): "Breach remedies,
reliance and renegotiation," International Review of Law and Economics, 26,
263-296.
Smith, A. M. (2011): "An experimental study of exclusive contracts," International
Journal of Industrial Organization, 29, 4-13.
Spier, K. and M. Whinston (1995): "On the efficiency of privately stipulated damages
for breach of contract: entry barriers, reliance, and renegotiation," RAND Journal
of Economics, 26, 180-202.
Sunstein, C. R. (2000): Behavioral law and economics, Cambridge University Press.
Zeiler, K. (2016): "What Explains Observed Reluctance to Trade? A Comprehensive
Literature Review," in Research Handbook on Behavioral Law and Economics, ed. by
K. Zeiler and J. Teitelbaum, Edward Elgar Publishing.
Zeiler, K. and J. Teitelbaum (2017): Research Handbook on Behavioral Law and
Economics, Research Handbooks in Law and Economics Series, Edward Elgar Publishing,
forthcoming.
Allgemeine Angaben
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Kurzbezeichnung20-201.32
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SemesterWintersemester 16/17
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ZielgruppenWiSo Promotionsstudiengang
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VeranstaltungsartSeminar
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VeranstaltungsspracheEnglisch
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EinrichtungenFakultät für Wirtschafts- und Sozialwissenschaften
Ort und Zeit
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OrtVon Melle Park 9 Raum A215
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Zeitam 26.01.2017 von 09:00 bis 17:00
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OrtVon Melle Park 9 Raum A215
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Zeitam 27.01.2017 von 09:00 bis 17:00
Anrechnungsmodalitäten
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Anzahl SWS1
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Anzahl Leistungspunkte2
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Anrechenbar als
- WiSo Promotionsstudiengang: WiSo Theorien für Sozialökonomie
- WiSo Promotionsstudiengang: WiSo Theorien für Volkswirtschaftslehre
Anmeldemodalitäten
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Art der PlatzvergabeManuelle Platzvergabe (nach Ende der Anmeldefrist)
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Anmeldeinformation–
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Max. Anzahl Teilnehmer20