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An Experimental Analysis of the Effect of Standards on Compliance and Performance

Forthcoming, Regulation & Governance

39 Pages Posted: 19 Dec 2014 Last revised: 29 Sep 2016

Constantine Boussalis

Trinity College (Dublin) - Department of Political Science

Yuval Feldman

Bar-Ilan University - Faculty of Law

Henry E. Smith

Harvard Law School

Date Written: September 28, 2016

Abstract

Legal directives, whether laws, regulations, or contractual provisions, can be written along a spectrum of specificity, about which behavioral and legal scholarship present conflicting views. We hypothesized that the combination of specificity and monitoring promotes compliance but harms performance and trust, whereas the combination of specificity and good faith enhances both the informative goal-setting aspects of specificity and people’s sense of commitment. To test these hypotheses, we used a 2x2x2 experimental design in which participants were instructed to edit a document, either with general or detailed instructions, either with a reference to good faith or without it, and either with monitoring or without it. Participants could engage in various levels and kinds of editing, allowing us to measure distinctly both compliance and performance. When participants require information and guidance, as in the case of editing, we found that specificity increases performance relative to the vague standard condition. We discuss the characteristics of the regulatory frameworks in which our findings are especially relevant.

Keywords: Behavioral ethics, Compliance and performance, Standard vs. Rules, Legal design, Specificity

JEL Classification: K19; K42

Suggested Citation

Boussalis, Constantine and Feldman, Yuval and Smith, Henry E., An Experimental Analysis of the Effect of Standards on Compliance and Performance (September 28, 2016). Forthcoming, Regulation & Governance. Available at SSRN: https://ssrn.com/abstract=2539190 or http://dx.doi.org/10.2139/ssrn.2539190

Constantine Boussalis

Trinity College (Dublin) - Department of Political Science ( email )

3 College Green
Trinity College
Dublin, 2
Ireland

Yuval Feldman (Contact Author)

Bar-Ilan University - Faculty of Law ( email )

Faculty of Law
Ramat Gan, 52900
Israel

Henry Smith

Harvard Law School ( email )

1575 Massachusetts
Hauser 406
Cambridge, MA 02138
United States

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