Edited by Hans-W. Micklitz, Anne-Lise Sibony and Fabrizio Esposito
Chapter 4: Rational choice and behavioural approaches to consumer issues
Economics addresses choice and behaviour at the individual level, under assumptions relating to both information and rationality. Rational choice and behavioural models represent two different approaches to individual decision-making with respect to the parameters that shape individuals’ decisions and the possibilities of reaching optimal outcomes based on individuals’ preferences. Understanding how individuals take decisions is of crucial importance for contract design, particularly in the context of consumer contracts. This chapter argues that neither rational choice nor behavioural frameworks are entirely incompatible, neither contain the sole ‘right and general’ answer to all the problems and challenges facing consumer contracting. Instead, a more nuanced approach, which is flexible enough to privilege one or the other model depending on the question to be answered, the dimension to be explained and the added value or the shortcomings of one model in a given setting, seems to be more enlightening, and in the end more desirable, at both the theoretical and the policy levels.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.