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68 La. L. Rev. 117 (2007-2008)
Behavioral Science and Consumer Standard Form Contracts

handle is hein.journals/louilr68 and id is 121 raw text is: Behavioral Science and Consumer Standard Form Contracts Shmuel I. Becher* TABLE OF CONTENTS Introduction .......................................................................... 118 I. A Brief Preface to Behavioral Law & Economics ............... 122 II. Perception of Self Commitment ........................................... 125 A . The Sunk Cost Effect ..................................................... 125 B . Cognitive D issonance .................................................... 131 C. The Confirm ation Bias ................................................... 132 D. The Low-Ball Technique ............................................... 133 E. Specific Contract Term s ................................................ 136 1. Rent-to-Own Transactions and Periodic Paym ents Term s ....................................................... 136 2. Unilateral Modification Terms ................................. 138 III. Distortion and Misperception of Contractual Risks ............. 140 A . Low -Probability Risks ................................................... 142 B . A vailability Cascades ..................................................... 144 C . Self Serving Biases ........................................................ 147 D . Consum ption Culture ..................................................... 150 IV. Emotional Stress and Consumer Harassment ...................... 152 A The Theoretical Background .......................................... 153 B. Consumer Contracts Settings ......................................... 153 Copyright 2007, by LOUISIANA LAW REVIEW. * Assistant Professor, The College of Management Academic Studies-School of Law. LL.B., Tel Aviv University (2001); LL.M (2003), J.S.D. (2005), Yale Law School. Many thanks to Benjamin Alarie, Ian Ayres, Yaron Back, Amichai Cohen, Mary Davis, Henry Hansmann, Daniel Markovits, Jeffery Rachlinski, Alan Schwartz and the participants of the Yale Law School Graduate Seminar, the Hebrew University Faculty of Law Seminar, the Bar Ilan University Faculty of Law Seminar, and the Haifa University Faculty of Law Seminar for comments on earlier drafts. I also acknowledge the generous financial support of Yale Law School and the Fulbright Program.