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Law and economics scholarship suggests that, in appropriate cases, the law can improve people’s behavior by changing their preferences. For example, the law can curb discriminatory hiring practices by providing employers with information that might change their discriminatory preference. Supposedly, if employers no longer prefer one class of employees to another, they will simply stop discriminating, with no need for further legal intervention. The current Article aims to add some depth to this familiar analysis by introducing the insights of behavioral ethics into the law and economics literature on preference change. Behavioral ethics research shows that wrongdoing often originates from semi-deliberative or non-deliberative cognitive processes. These findings suggest that the process of preference change through the use of the law is markedly more complicated and nuanced than previously appreciated. For instance, even if an employer’s explicit discriminatory stance is changed, and the employer no longer consciously prefers one class of employees over another, discriminatory behavior might persist if it originates from semi-conscious, habitual, or non-deliberative decision-making mechanisms. Therefore, actual change in behavior might necessitate a close engagement with people’s level of moral awareness. We discuss the institutional and normative implications of these insights and evaluate their significance for the attempt to improve preferences through the different functions of the legal system.

Background and objectives Stressors related to the COVID-19 pandemic are risk factors for psychopathology, but psychosocial protective factors might play a crucial role in buffering the pathogenic effects of the outbreak. Design In the current study, we examined the association of inner resources and potential external sources of support for coping with the pandemic and related lockdowns to mental health during the pandemic, while controlling for sociodemographic variables as covariates. Methods We tested the model in a probability-based internet survey of a representative sample of the Israeli adult population (N = 812) conducted during the COVID-19 pandemic. Results Perceived support in close relationships was negatively associated with the intensity of depression, anxiety, obsessive-compulsive disorder (OCD) and post-traumatic stress disorder (PTSD). Larger rings of potential support such as perceived belongingness to a community and trust in government were also negatively related to anxiety and depression but were positively associated with the intensity of OCD and PTSD. Conclusions Findings support the "tend and befriend" theory in the social distancing era and highlight the importance of keeping personal relationships alive when facing a mass trauma.

Most companies use codes of conduct, ethics training, and regular communication to ensure that employees know about rules to follow to avoid misconduct. In the present research, we focused on the type of language used in codes of conduct and showed that impersonal language (e.g., “employees” or “members”) and personal, communal language (e.g., “we”) lead to different behaviors because they change how people perceive the group or organization of which they are a part. Using multiple methods, including lab- and field-based experiments (total N = 1,443), and a large data set of S&P 500 firms (i.e., publicly traded, large U.S. companies that are part of the S&P 500 stock market index), we robustly demonstrated that personal, communal language (compared with impersonal language) influences perceptions of a group’s warmth, which, in turn, increases levels of dishonesty among its members.

Law and economics scholarship suggests that, in appropriate cases, the law can improve people’s behavior by changing their preferences. For instance, the law can curb discriminatory hiring practices by providing employers with information that might change their preferences towards discriminatory hiring. Supposedly, if employers no longer prefer one class of employees to another, they will simply stop discriminating, with no need for further legal intervention. The current paper adds some depth to this familiar analysis by introducing the insights of behavioral ethics into the law and economics literature on preference change. Behavioral ethics research shows that wrongdoing often originates with semi-deliberative or non-deliberative cognitive processes. These findings suggest that the process of preference change, through the use of the law, is markedly more complicated and nuanced than previously appreciated. Thus, for instance, even if an employer’s explicit discriminatory stance is changed, and the employer no longer consciously prefers one class of employees over another, discriminatory behavior might still surface if it originates with semi-conscious, habitual, or non-deliberative decision-making mechanisms. Therefore, actual change in behavior might necessitate a close engagement with people’s level of moral awareness. We discuss the institutional and normative implications of these insights and evaluate their significance for the attempt to improve preferences through the different functions of the legal system.

This chapter studies the implications of behavioral ethics research to questions of legal compliance. Behavioral ethics emphasizes the concept of bounded ethicality, referring to a long list of biases and cognitive limitations that prevent people from making a full and candid evaluation of the ethicality of their own actions. In other words, people often act unethically not because they made a conscious choice to behave badly, but because they were able to ignore, downplay, or justify their own misconduct. This chapter explores the meaning of behavioral ethics findings for questions of compliance with the law. That is, if people often ignore or downplay their own unethical choices, how can law-makers and regulators act to improve compliance with the law? The chapter describes the central relevant findings of behavioral ethics research, the challenges these findings pose for legal compliance, and outlines possible solutions. In particular, we advocate a novel regulatory approach utilizing ethical nudges: regulatory interventions that are designed to improve ethical deliberations by potential wrongdoers.

Experts in many domains, from education and finances to sports and entertainment, make multiple similar but independent decisions in sequence. Does the mere serial position of a case in a sequence influence the decision? We focus on the legal domain in which many high-stakes decisions are made in a sequence and justice considerations imply irrelevant factors like serial position of a case must not impact decision making. We identify four mechanisms that can drive serial position effects and note each can have different predictions, hence existence and direction of such effects are empirical questions. Indeed, most empirical evidence from non-legal settings suggests decisions become more favorable with serial position, but a previous study of sequences of parole hearings finds the opposite effect. We analyze two field datasets, 386,109 US immigration judges’ decisions on asylum requests and 20,796 jury decisions in 18th century London criminal court, and find decisions become more favorable (lenient) the later a decision is made in a sequence of decisions. To complement the analysis, we run three controlled experiments with laypeople and find similar results. We conclude that while serial position effects may be context-specific, from the point of view of the individual involved, it is often best to be last.

There is individual variation in the extent to which individuals believe it is acceptable to violate legal rules. However, we lack a specific measure that assesses this key internal element of legal decision-making and offending. This article describes the development, validation, and testing of the Rule Orientation scale. At its core, the construct captures the extent to which one thinks about rules in a rigid, rule-oriented manner or in a manner that recognizes exceptions. In the first study, we develop the Rule Orientation scale, demonstrate its convergent and divergent validity with key legal and moral reasoning scales, and find that Rule Orientation relates to hypothetical offending behavior across a variety of low-level crimes. In the second study, we examine whether Rule Orientation predicts the propensity to engage in digital piracy both with and without the explicit threat of punishment. The results indicate that Rule Orientation plays a crucial role in predicting offending behavior and, importantly, does so across enforcement contexts. The findings suggest that an individual with low Rule Orientation may be able to justify offending regardless of whether a system explicitly declares an enforcement campaign, regardless of how the individual perceives the severity of the threatened sanction, and regardless of whether the individual believes social norms support law violation. In understanding ethical decision-making, criminal decision-making, and other strands of legal decision-making, identifying such individual variation is crucial.

This article presents the first empirical study on whether anchors influence the interpretation of vague legal standards. To test this question, the article presents a series of stylized experiments that measure and compare participants’ interpretation of a vague norm after they were exposed to anchors. Overall, the results suggest that the content of substantive legal rules might be altered by anchors. This effect is documented in numerous legal settings (e.g., torts, corporate, copyright) and across both expert (i.e., experienced lawyers) and nonexpert (i.e., students) populations. Furthermore, the effect is shown to exist both when participants express judgments on a numeric scale and when they make dichotomous judgments that are detached from that scale. Based on these findings, the article revisits several long-standing legal debates and reevaluates their conclusions.

This paper seeks to explore whether the interpretation of legal standards is influenced by decision-makers’ substantive decision. Prior literature on motivated reasoning has shown that decision-makers “shift” their perception of evidence in their desired direction. To the extent this logic applies to legal-standards, we should expect decision-makers to adjust the perception of the legal standard accordingly — e.g., one’s decision to favor the plaintiff would induce a pro-plaintiff interpretation of the required threshold to win a case. We present the results of two experiments in which we asked subjects to report their interpretation of the applicable legal threshold after deciding a case, under different legal thresholds. Our participants, by and large, did not shift the legal standard to conform to their substantive decision, contrary to the theoretical expectations. We thus conclude that decision-makers treat the legal standard distinctly than regular evidence.

Two insights of psychology on which we would like to draw are that people react to law in more complex ways than rational-choice models assume and that good people sometimes do bad things. With that starting point, this article provides a behavioral perspective on some of the factors that policymakers seeking to reduce the level of misconduct in the pharmaceutical industry should consider. Effective regulation and enforcement need to address the following questions: Who are the regulation's targeted actors - researchers or executives? Are the regulations directed toward research or marketing activities? Is the misconduct a product of explicit rational choice or implicit processes of which the actor is unaware? Is it reasonable to address all types of misconduct using the same approach? Certain misconduct - particularly by researchers - is due to automatic, intuitive, and unconscious decisions and needs to be addressed through different means than those used to address misconduct due to controlled, deliberate decisions. This article therefore recommends using different sorts of regulation depending on the context. It suggests more tailored enforcement mechanisms that will be sensitive to the pharmaceutical researchers' unique work motivations and to their awareness or lack of awareness of their own misconduct.

This study addresses the question of whether and how legal authorities ought to intervene in work organizations in order to most effectively regulate the behavior of employees. This question is examined empirically, by exploring whether the association between the level of fairness employees experience in procedures regarding pay and benefits, and their adherence to workplace rules, differs depending upon whether those procedures are enacted by companies voluntarily or mandated by law. This question was addressed using both a survey of a representative sample of employees in Israel, as well as their reactions to an experimental vignette. The results generally suggest that evaluations of the procedural justice of performance appraisal hearings more strongly influenced judgments of overall workplace fairness, perceptions of management legitimacy, and employee rule-adherence behavior when employees believed fairer workplace procedures were required by law.

This paper examines how different legal instruments affect people's moral intuitions and willingness to engage in social enforcement in the field of environmental law. These instruments vary in terms of their governance technique, the process through which they were enacted, and their allocation of enforcement responsibilities. Their effect on citizens' moral evaluation and emotional reaction to corporate polluting behaviour are examined, based on an experimental survey of a representative sample of 1400 individuals in Israel. Our findings demonstrate that their design influences people's level of moral and emotional resentment when faced by environmentally problematic behaviour, as well as their motivation to engage in private enforcement. The design of the regulatory instrument could thus generate biases in social reactions to polluting behaviour, irrespective of its actual ecological adverse effect. We analyse the moral and psychological mechanisms which underlie these effects and explore their various policy implications.

In recent years, scholarly interest in unethical behavior in the workplace has been rapidly increasing. Recent research in this area has highlighted that unethical behavior is routinely committed b...

The present chapter attempts to map the literature of ethical decision making in psychology and management and examine the ways in which it could shape behavioral law and economics. In the last ten years, research in the field of ethical decision making has grown exponentially, mainly in the area of behavioral ethics or bounded ethicality. The new literature uncovers the various cognitive and motivational mechanisms that cause good people to engage in bad behaviors. This shift in focus has made ethical decision making an important area both normatively and descriptively for the scholarship on management. In the present chapter I make the case that as a result of the shift, this literature has become important to the law in general and to the domain of behavioral law and economics in particular. Moreover, I argue that to some extent this literature poses a much greater threat to the assumptions of rationality than does classical behavioral law and economics because it reexamines both the "self" in self-interest and the limited importance of "choices" in accounting for people's decisions and behaviors. In conducting this review, I examine all of the important paradigms and biases that have been developed in this area, such as moral disengagement, self-deception, moral licensing, automaticity of self-interest, moral hypocrisy, elastic justification, ethical fading, blind spots, and the dishonesty of honest people. I argue that although there has been a significant advance in the understanding of ethical decision making, our understanding is still not as developed as it seems, with numerous and at times conflicting paradigms attempting to describe how good people are responsible for bad deeds. I attempt to create some order on the descriptive side, explaining the principal taxonomies and highlighting their strengths and weaknesses. On the normative side, I show how the mechanisms developed by this literature uncover the limited ability of current enforcement strategies to shape behavior. The chapter concludes with some tentative suggestions on how to overcome these limitations and address the unaware, automatic unethical behaviors that are described by the bounded ethicality literature. In particular, I focus the legal feasibility of concepts such as dual reasoning enforcement, statistical unethicality, disambiguation, accountability and reflection.

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.

The influence of social norms on the willingness to obey legal norms depends on contingencies that have not been investigated. Theoretical, behavioral, and experimental considerations investigated in this paper establish the differential behavioral effects of legal rules and standards. The findings of experiments conducted by us indicate that in the absence of information concerning social norms, rules and standards have similar effects on compliance. In contrast, rules and standards have differential effects on compliance when they interact with social norms. Furthermore, it was found that social norms of noncompliance had a much greater effect than social norms of compliance. A second study demonstrated a similar relationship between self-interest and legal ambiguity, corroborating the theoretical mechanisms we have argued for, based on the findings of the first study. The implications of these findings to legal policy-making are discussed.

This paper examines whether the nature of information protected by trade-secrets law impacts departing employees' normative judgments of obedience to trade-secrets law. This examination is based on a comparison of three manipulated hypothetical scenarios: when the employee memorizes the confidential information, when the employee develops the confidential information herself and when the employee downloads the confidential information to her personal computer. The empirical analysis is based on data collected from a non-random multi-sourced sample of 260 high tech employees in Silicon Valley. These experimental manipulations enable me to examine and compare the contributions of tangibility and authorship to employees' normative evaluations of the sharing of confidential information/trade secrets. I conclude that while tangibility was a far stronger factor in employees' normative evaluations of trade secrets, authorship was strongly related to the morality of trade-secrets disclosure. In addition, based on a path-analysis approach, I examine and compare the ways in which social costs, legal costs, morality and perceived psychological contract contribute to the effects of tangibility and authorship on employees' normative evaluations of the sharing of confidential information/trade secrets. When attempting to explain the effect of tangibility, the expected social approval of the new firm proved to be the most important factor. I conclude with an examination of the behavioral importance of several legal paradigms to Silicon Valley high tech employees' views of trade secrets - general paradigms such as loyalty and ownership are considered in addition to more particular paradigms such as the "labour theory" and the memory rule.

Attitudes of public groups towards behavioral policy interventions (or nudges) can be important for both the policy makers who design and deploy nudges, and to researchers who try to understand when and why some nudges are supported while others are not. Until now, research on public attitudes towards nudges has focused on either state- or country-level comparisons, or on correlations with individual-level traits, and has neglected to study how different social groups (such as minorities) might view nudges. Using a large and representative sample, we tested the attitudes of two distinct minority groups in Israel (Israeli Arabs and Ultra-Orthodox Jews), and discovered that nudges that operated against a minority group’s held social norms, promoting a more general societal goal not aligned with the group’s norms, were often less supported by minorities. Contrary to expectations, these differences could not be explained by differences in trust in the government applying these nudges. We discuss implications for public policy and for the research and applications of behavioral interventions.