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Social Norms and Legal Design

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  • Bruno Deffains
  • Claude Fluet

Abstract

We consider legal obligations against a background of social norms, for example, societal norms, professional codes of conduct, or business standards. Violations of the law trigger reputational sanctions insofar as they signal nonadherence to underlying norms, raising the issue of the design of offenses. We show that the law generally ought to follow social norms or be stricter than them. When society is only concerned with the trade-off between deterrence and enforcement costs, legal standards defining offenses should align with underlying norms so long as the latter are not too deficient. When providing productive information to third parties is also a concern, legal standards should either align with underlying norms with fines that trade off deterrence against the provision of information; or legal standards should be more demanding and enforced with purely symbolic sanctions, for example, public reprimands. Our analysis has implications for general law enforcement and regulatory policies.

Suggested Citation

  • Bruno Deffains & Claude Fluet, 2020. "Social Norms and Legal Design," Journal of Law, Economics, and Organization, Oxford University Press, vol. 36(1), pages 139-169.
  • Handle: RePEc:oup:jleorg:v:36:y:2020:i:1:p:139-169.
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    File URL: http://hdl.handle.net/10.1093/jleo/ewz016
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    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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