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Against the background of rational choice theory, this chapter provides an overview of the behavioral sub-disciplines informing behavioral law and economics—including judgment and decision-making studies, parts of social psychology, moral psychology, experimental game theory, and behavioral ethics. The chapter discusses deviations from cognitive and motivational rationality, including studies of people’s moral judgments. It begins with probability assessments and related issues. It critically describes phenomena related to prospect theory, phenomena associated with motivated reasoning and egocentrism, and those related to reference-dependence. It also summarizes studies of bounded willpower. Some attention is given to studies that show that most people do not share the consequentialist outlook that prioritizes the maximization of human welfare over all other values. Finally, the chapter discusses several issues that cut across various phenomena: individual differences in judgment and decision-making; the significance of professional training, experience, and expertise; deciding for others; group decision-making; cultural differences; and debiasing.

This chapter surveys the contributions of behavioral studies to the analysis of criminal law and law enforcement. It begins by introducing the key insights of economic analysis of crime control. It then examines the extent to which people’s moral judgments are compatible with the dictates of economic analysis in this sphere—and the associated normative implications. It proceeds to analyze the ramifications of behavioral findings regarding how people perceive probabilities and sanctions for deterrence theory. The chapter e also examines the contribution of research in the area of behavioral ethics to crime control. Finally, it discusses the implications of behavioral research for recidivism.

People often face tempting situations in which they can secure profit in dishonest ways. Here we survey a variety of justification processes that free people to engage in dishonesty. We distinguish two main categories: (1) self-serving justifications, in which one justifies one’s actions by processing information in a self-benefiting way; and (2) socially motivated justifications, in which one justifies unethical acts by reference to an additional, socially beneficial factor. We close with a discussion of the ethical hazard of corrupt collaboration (i.e., joint unethical acts). Corrupt collaboration is a major challenge to institutions and societies as it places individuals in a dilemma: collaborate with peers or follow ethical rules of conduct. Recent work suggests that in such situations, people prefer collaboration over honesty. We discuss the dynamics of corrupt collaboration, the ways in which these toxic relationships emerge and spread, and how we can curb such behavior and encourage honest, ethical conduct.

Acting to benefit others first requires that one perceive other living beings with needs and desires - that is, it requires social cognition. Prosocial behavior further requires the motivation to act, which may stem from empathetic processes, and the desire to reduce the misfortune of another. This motivation may also require the ability to anticipate some future reward, whether that reward is anticipated reciprocity, or the "warm glow" of being a good person. This chapter is organized around the distinct psychological processes underlying prosocial behavior. First, the chapter outlines the processes that are likely required for prosocial action to occur. The chapter discusses the neural mechanisms underlying each of these psychological processes, and use this discussion as a lens through which to interpret research directly relating prosocial behavior to the brain. Finally, the chapter discusses ambiguities in the interpretation of the current research, and suggest future directions.