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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 >>