The Efficacy of Regulation as a Function of Psychological Fit: Reexamining the Hard Law/Soft Law Continuum

12 Theoretical Inquiries In Law 581 (2011)

22 Pages Posted: 9 Jun 2013

See all articles by Deborah Rupp

Deborah Rupp

University of Illinois at Urbana-Champaign - School of Labor & Employment Relations; University of Illinois at Urbana-Champaign - Department of Psychology

Cynthia A. Williams

York University - Osgoode Hall Law School

Date Written: June 7, 2011

Abstract

Much of the legal literature discusses regulation and regulatory forms with a seemingly implicit assumption that "those to be influenced" are inherently self-interested and thus motivated to comply with legal structures only when there are sufficient external incentives to do so. This view of the person is inconsistent with recent perspectives in the field of psychology. A law and morality perspective, coupled with insights from the field of psychology, asserts that influence, compliance, and motivation are far more complex than this legal literature would suggest. In this Article, we map the varying influence structures, motives, psychological needs, emotional mechanisms, and levels of moral reasoning that various forms of regulation, from hard law to soft law, might affect. We provide examples from global banking and one soft law initiative, the Equator Principles, to illustrate reasons psychology would suggest why soft law may be more effective in some circumstances in influencing behavior within the firm than hard law, while recognizing important limits to such influence.

Keywords: Regulation, regulatory theory, social psychology, enforcement, compliance, motivation, soft law, hard law, Equator Principles, banking regulation

JEL Classification: G21, K20, K22, K42, M14, L50

Suggested Citation

Rupp, Deborah and Williams, Cynthia A., The Efficacy of Regulation as a Function of Psychological Fit: Reexamining the Hard Law/Soft Law Continuum (June 7, 2011). 12 Theoretical Inquiries In Law 581 (2011). Available at SSRN: https://ssrn.com/abstract=2276030

Deborah Rupp

University of Illinois at Urbana-Champaign - School of Labor & Employment Relations ( email )

504 East Armory Avenue
Champaign, IL 61820-6297
United States

University of Illinois at Urbana-Champaign - Department of Psychology ( email )

603 East Daniel
Champaign, IL 61820
United States

Cynthia A. Williams (Contact Author)

York University - Osgoode Hall Law School ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada
416-736-5545 (Phone)

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