The Importance of Being Earnest: Two Notions of Internalization

University of Toronto Law Journal, 2015

Hebrew University of Jerusalem Legal Research Paper No. 15-12

46 Pages Posted: 15 Jun 2014 Last revised: 1 Apr 2016

Date Written: December 11, 2014

Abstract

Through its use of sanctions and rewards, the law can affect people’s conduct in two ways: by modifying only their external behavior (behavioral change), or by changing their underlying preferences, as well (preference change). In both cases, the legal rules can be said to have been “internalized” — however, while in the former instance the individuals’ conduct conflicts with their values, attitudes and beliefs, in the latter it coincides with them. There is an ongoing debate as to whether policymakers should attempt to shape people’s preferences. The main opposition to preference change is based on considerations of autonomy, since this form of internalization appears to be more intrusive than mere behavioral change.

This Article re-evaluates the impact of these two modes of internalization on personal autonomy. Based on theoretical arguments and the findings of two new experiments, it argues that the drawbacks of behavioral change have been downplayed, while those of preference change have been overstated. Indeed, in certain respects, the preference change mode of internalization is found to be less coercive than behavioral change — not only in theory, but according to people’s actual perceptions of autonomy, as well. Specifically, limiting the law’s effect to people’s external behavior is likely to require stronger incentives than those needed to influence their underlying preferences. In addition, individuals view a person’s conduct as being less autonomous when the law has changed only her behavior as opposed to her inner preference for the activity. Although the former type of legal influence is superficial — in that it does not modify any attitude, value or belief that a person holds — it was perceived as the most intrusive. The analysis has normative implications for important legal issues, such as the choice between default and mandatory rules, and between direct and indirect remedies.

Keywords: internalization, behavioral law and economics, preference change, experimental legal studies, property law, environmental law, remedies, default rules, autonomy, cognitive dissonance, libertarian paternalism, nudge

JEL Classification: K10, K11, K12, K32

Suggested Citation

Lewinsohn-Zamir, Daphna, The Importance of Being Earnest: Two Notions of Internalization (December 11, 2014). University of Toronto Law Journal, 2015, Hebrew University of Jerusalem Legal Research Paper No. 15-12, Available at SSRN: https://ssrn.com/abstract=2450445

Daphna Lewinsohn-Zamir (Contact Author)

Hebrew University - Faculty of Law ( email )

Mount Scopus
Mount Scopus, IL 91905
Israel
972-2-5823845 (Phone)
972-2-5829002 (Fax)

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