This article shows that the behavior of perfectly rational financial actors can cause financial meltdowns like the ones that occurred in 2007 and 2008. It analyzes the nature of informational asymmetries and group pathologies common in financial transactions and the role of intermediaries and...

This article argues that repeated criminal misconduct, at least in some areas, has the characteristics of a habit or addiction. Curiosity or a transient attraction can lead an offender to commit her first crime. This first infraction will give her a sense of how much she enjoyed it, and whether...