Learning and the law: improving behavioral regulation from an international and comparative perspective

Various disciplines increasingly are discovering the power of learning. However, the potential and the complexities of learning theory in decision making contexts have so far been neglected by scholarship in Law and Economics as well as Behavioral Law and Economics: either learning is uncritically assumed to work its magic and to mitigate biases, or it is generally claimed that learning is insufficient to overcome cognitive biases. Even where learning is taken into account the scope is limited to individual or social learning only. The crucial factor of learning by and across institutions is largely ignored. This, however, should be paramount as an increasing number of institutions, at the international and domestic level, adopt behavioral regulation, which prides itself on facilitating “smart decisions.”

This paper argues that legal analysis should tap the precious resource of learning to facilitate lasting and beneficial real-world effects. It draws on social and cognitive psychology, behavioral game theory and organizational science to show that there are vast effectiveness and efficiency gains to be made from an integration of learning theory into regulatory and private law contexts. Interdisciplinary learning theory suggests that such gains can be made through learning by doing, observational learning, recursive and generative learning. These learning methods can be used at the individual, social, team, and institutional level, which is demonstrated using a string of case studies from international law, as well as US and EU law. As an overarching category subsuming these forms of learning, the paper develops the concept of systemic learning. It suggests that the law ought to introduce systemic learning patterns in public and private law contexts through cognitively optimized disclosures, feedback loops and institutionalized systemic learning facilities. Finally, it proposes the institutionalization of an Agency for Systemic Learning Management. Having ignored learning theory in the past, future behavioral regulation should put learning efforts center stage as it unfolds on a global scale.