Lessons in Behavioral Economics
January 16, 2013 - "Deciding by Default: Lessons in Behavioral Economics" Penn Program on Regulation recently held a Risk Regulation Seminar on legal regulation based on behavioral economics led by Harvard Law professor, Cass Sunstein. Professor Sunstein described the issue with defaulting rules in business contracts, such as insurance plans, phone bills, loans, etc. He talked about the impact of impersonal one-size-fits-all rules for defaulting as well as the pros and cons of more personalized plans where customers can select their own rules for defaulting. Sunstein gives this latter option as a potential choice for future consumers in this new age of individuality and personalization. Professor Sunstein is the Felix Frankfurter Professor of Law at Harvard Law School and served as an attorney-advisor in the Office of the Legal Counsel of the U.S. Department of Justice. Sunstein has also been an administrator at the White House Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB). Professor Sunstein also served as the keynote speaker at the second Annual Regulation Dinner for the Penn Program on Regulation.