Langevoort, Donald C. --- "Behavioral Approaches to Corporate Law" [2012] ELECD 478; in Hill, A. Claire; McDonnell, H. Brett (eds), "Research Handbook on the Economics of Corporate Law" (Edward Elgar Publishing, 2012)

Book Title: Research Handbook on the Economics of Corporate Law

Editor(s): Hill, A. Claire; McDonnell, H. Brett

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781848449589

Section: Chapter 23

Section Title: Behavioral Approaches to Corporate Law

Author(s): Langevoort, Donald C.

Number of pages: 14

Extract:

23. Behavioral approaches to corporate law
Donald C. Langevoort



1. INTRODUCTION
In corporate legal scholarship, `behavioral' analysis refers to using insights from psychology
to address the relationships, rights and responsibilities among officers, directors, investors
and other stakeholders. That does not make it a particularly well-defined subject. Psychology
is a capacious field, running from the brain studies done by cognitive neuroscientists to the
observations of interpersonal interactions in social cognition and social psychology labora-
tory experiments, the latter then bleeding into the separate field-study oriented research
programs of sociology and cultural anthropology. In all these, there is so much ­ perhaps too
much ­ for legal scholars to think about as potentially useful behavioral traits. Fortunately,
researchers in business schools have for some time been using psychology as a tool for
research specifically directed to organizational behavior and corporate governance, thereby
giving legal scholars help in making connections of particular use to the analysis of corporate
law-related issues (Camerer & Malmendier 2007).
My contribution reflects on the challenges of making these connections and some of the
successes that have occurred so far. I make no effort to provide a thorough literature review
­ the number of published articles and works in progress that plausibly fall into the `behav-
ioral corporate law' category is sizable, and grows rapidly each year. The amount of contem-
porary scholarship in business, finance and economics that turns to psychology for insight
relating to business institutions, from which legal research can then draw, is much larger.
What I ...