De iure De-iure - Page 17

Page 17 / De iure September 2018 United States to gather information about consumer behaviors. If the legal system had access to this information, different defaults could be set for different population groups in a variety of fields. Under a personalized approach to default rules, individuals could be assigned default terms in contracts or wills that are tailored to their own personalities, characteristics and past behaviors. It might sound like science fiction, but Prof. Strahilevitz and I demonstrate that this will soon become a reality.” find the flexibility and ability to do so a deciding factor in the purchase, while it is less important to me. I might spend more time deciding to purchase. You would probably pay more in this case because you could return the product at will, whereas I would pay less because I don’t care about returning it. Another example is in remedies for breach of a contract: specific performance versus damages. There is a big debate in legal literature concerning the most efficient and just remedy.” How is personalization relevant here? Prof. Ariel Porat inheritance should mirror the wishes of the diseased as far as possible, why should the legal default be a certain average for the entire population when we have reliable statistical information indicating that men and women have different wishes? Wouldn’t it make more sense to have two defaults, one for men and one for women? And if there is a difference in this matter between Christians, Muslims and Jews, or a difference between people of different ages, why not set bespoke defaults to a cross-section of the population so that each has a personalized default?” In an article you wrote with Prof. Lior Strahilevitz of the University of Chicago, “Personalizing Default Rules and Disclosure with Big Data”, you talk about the databases that are storing these statistics and the potential use of them. “That’s right, and this is where Big Data comes in. Big Data refers to the massive volumes of data collected on everything from internet searches to app usage and Internet of Things devices, collecting a wealth of information about consumer behaviors. The data is used primarily for marketing. Some studies show that in 2013, $34BN were spent in the If we believe the law of inheritance should mirror the wishes of the diseased as far as possible, why should the legal default be a certain average for the entire population when we have reliable statistical information indicating that men and women have different wishes? Can you provide an example of where you see this manifesting? “The typical example is in consumer contracts. For instance, the right to return a product and get your money back. In Israel, this right was established as mandatory a few years ago and not as default. But in most countries, it is the default which determines whether or not there is a right to return a product. If there is enough information on each consumer, there might be more than one default. For example, it might be important to you to have the right to return the product whereas I don’t mind, because you might “Let’s say you and I separately buy an apartment from the same contractor. You care much about the moral value of keeping promises, whereas I care more about economic efficiency. Personalization is designed to identify our different preferences in this situation so that each one of us receives a default that matches our values. Another example is the personalization of disclosure. In the area of medical malpractice, before any medical treatment is administered to a patient the physician is required to disclose all the risks involved, thereby enabling the patient to make an informed decision as to whether to take Some studies show that in 2013, $34BN were spent in the United States to gather information about consumer behaviors. If the legal system had access to this information, different defaults could be set for different population groups in a variety of fields Continued >>