This paper explores potential endowment effects of contractual default rules. For this purpose, we analyze the Hadley liability default clause in a model of bilateral bargaining of lotteries against safe options. The liability default clause determines the right for the safe payoff option. We...

The market for law professors fulfils the conditions for a hog cycle: in the short run, supply cannot be extended or limited; future law professors must be hired soon after they first present themselves, or leave the market; demand is inelastic. Using a comprehensive German dataset, we show that...

Privacy law relies on the argument that consent does not entail any relevant impediments for the liberty of the consenting individual. Challenging this argument, we experimentally investigate whether consent to the publication of personal information in cyberspace entails self-coercion on a...

The human mind is not a general problem solving machine. Instead of deliberately, consciously and serially processing the available information, men can rely on routines, rules, roles or affect for the purpose. They can bring in technology, experts or groups. For all of these reasons, men have a...

What is the impact of firm entry regulation on sustained entry into self-employment? How does firm entry regulation influence the performance of long-living entrants? In this paper, I address these questions by exploiting a natural experiment in firm entry regulation. After German reunification,...

We report an experiment designed to test the influence of noisy commitments on efficiency in a simple bargaining game. We investigate two different levels of commitment reliability in a variant of the peasant-dictator game. Theoretical analysis suggests that the reliability of commitments in...

Mutual disdain is an effective border patrol at the demarcation lines between disciplines. Social scientists tend to react with disdain when they observe how their findings are routinely stripped of all the caveats, assumptions and careful limitations once they travel into law. Likewise, lawyers...

Originally, behavioral law and economics was an exercise in exploring the implications of key findings from behavioral economics (and psychology) for the analysis and reform of legal institutions. Yet as the new discipline matures, it increasingly replaces foreign evidence by fresh evidence,...

Customary law has been criticized from very different angles. Rational choice theorists claim that what looks like custom is nothing but self-interest. Positivists doubt that anything beyond consent assumes the force of law. In this paper, we adopt an experimental approach to test these claims....

The novel part of this paper is a model of the principle of proportionality, as the cornerstone of the doctrine of fundamental rights. German law, and with some modifications also the law of the European Community and the European Convention on Human Rights, do not categorically outlaw...