Last Friday one of the authors of the blog attended the first Yale-Humboldt Consumer Law Lecture. The lecture aims at encouraging the exchange between U.S. and European lawyers in the field of consumer law and is organised by Professor Susanne Augenhofer from Humboldt University in Berliln. For the first lecture she invited three distinguished professors from Yale Law School: Alan Schwartz, Roberta Romano and Daniel Markovits.
In his presentation on 'Regulating for Rationality' Alan Schwartz argued that even though experimental results in psychology and behavioral economics have shown that consumers do not always act as the model of homo oeconomicus would suggest, regulators should retain the rationality premise. As long as there is no general psychological theory on how laboratory results are likely to translate into market results, regulators should stick with disclosure regulation.
Roberta Romano gave a lecture on 'The Consumer Financial Protection Bureau (CFPB) and the Iron Law of Financial Regulation'. She showed that the CFPB was created in the midst of a financial crises and pointed at the risks of such crisis-driven legislation. She suggested to sunset legislation, so that all provisions must be reviewed and reenacted after a fixed time period. Furthermore, she encouraged small scale experimentation and flexibility in implementation.
Daniel Markowits ('Sharing Ex Ante and Sharing Ex Post') argued that understanding fiduciary law requires a model besides contract. He showed that the core duties of the two relations differ. In contract law it is good faith, in fiduciary law it is fidelity or loyalty and care. Another difference is that contract partners share ex ante while fiduciaries share ex post.
Another interesting event will take place in Berlin on October 20th. Oren Bar-Gill (NYU, Harvard) will be talking about 'The Future of Consumer Law'. Looking forward to that!