One-Line Symposium on Contracts Profs Blog, 2014
18 Pages Posted: 12 Oct 2014 Last revised: 12 Jun 2016
Date Written: October 11, 2014
Within contract law studies, the law and economics paradigm is still the predominant paradigm, and its methods continue to guide a great deal of influential research. Much of the continuing strength of this paradigm nevertheless derives from its willingness to reject two of the central premises of the classical law and economics paradigm and replace them with better understandings, rooted in methods from the correct cognate fields.
More specifically, the classical economic assumption that humans act rationally is increasingly being replaced by genuine empirical research into human psychology. Classical reliance on economic modeling to predict the consequences of legal rules is also increasingly being replaced by genuine empirical research. These methodological moves have begun to breathe new life into the study of contract law.
But this research paradigm has not yet gone far enough, because it continues to rely on a third set of ungrounded normative premises, rather than turning to the cognate fields that have developed the most rigorous lines of argumentation relevant to normative questions. I argue that this fact has prevented large segments of the field from asking the right normative questions, when it comes to consumer protection law, or knowing how to assess the increasing number of psychological and empirical facts that are now at our disposal.
More Than You Wanted to Know illustrates both aspects of these developments. By rejecting the first two classical economic premises, it is able to pull together an increasingly persuasive body of evidence that credibly challenges one of the central dogmas of the classical law and economics paradigm. This is the dogma that mandatory disclosure regimes can be assumed to provide a useful and sufficient to cure a host of problems in consumer protection law. But because the book has not yet rejected the third set of ungrounded assumptions, it cannot tell us where to go from here.
If this paradigm were to begin to draw on the right lines of normative evidence and argumentation to answer normative questions, then it would be fundamentally transformed. What began as a mere sub-discipline in the law would change into a more fully informed and highly interdisciplinary search for the truth. But absent this transformation, the current paradigm risks generating continued distortions.
To cure these distortions, I argue that the right normative question to ask in consumer protection law is which set of laws would be equally empowering -- i.e., in the sense of giving both consumer and corporations the most equal opportunity to meet a broad range of needs and interests by influencing one another's actions with legally enforceable promises. But my methodological point goes deeper: we need increased interdisciplinary collaborations between economics, psychologist, empirical legal scholars -- on the one side -- and moral and legal philosophers -- on the other -- if we are to make true progress in tracking the truth.
Keywords: behavioral economics, law and economics, empowerment, contract, Ben-Shahar, Schneider, more than you wanted to know, consumer, consumer protection, social, welfare, disclosure, mandatory disclosure, rational actor
Suggested Citation: Suggested Citation
Kar, Robin Bradley, The Emerging New Life of Contract Law Studies: A Review of Ben-Shahar and Schneider's More than You Wanted to Know and a Methodological Plea to the Field (October 11, 2014). One-Line Symposium on Contracts Profs Blog, 2014. Available at SSRN: https://ssrn.com/abstract=2508719