Francesco Parisi is Professor of Law and Director, Law and Economics Program, George Mason University School of Law. He is co-editor of The Law and Economics of the European Union (2003), Economic Foundations of Private Law (2002), and Law and Economics (1997). Vernon Smith is Nobel Laureate in Economics, 2002, and Professor of Economics and Law, George Mason University.

• CONTENTS Acknowledgments Contributors Introduction Francesco Parisi and Vernon Smith Part IIrrationality and Bounded Rationality in Law, Psychology and Economics Chapter 1Departures from Rational Choice: With and Without Regret Robert Frank Chapter 2Is the Mind Irrational or Ecologically Rational? Gerd Gigerenzer Chapter 3Lessons from Neuroeconomics for the Law Kevin McCabe, Vernon Smith, and Terrence Chorvat Chapter 4Treating Yourself Instrumentally: Internalization, Rationality and Law Robert Cooter Part IIThe Economics of Irrational Behavior Chapter 5Addition, Choice and Irrationalit Ole Skog Chapter 6Revenge and Retaliation Vincy Fon and Francesco Parisi Chapter 7What Makes Trade Possible? Elizabeth Hoffman, Kevin McCabe, and Vernon Smith Chapter 8Satisfaction and Learning: An Experimental Game to Measure Happiness Marco Novarese and Salvatore Rizzello, Chapter 9The Market for Laughter F.H. Buckley Part IIIThe Jurisprudence of Irrational Behavior: Rethinking Law as Behavioral Instrument Chapter 10The Jurisprudence of Craziness Stephen Morse Chapter 11On Law Enforcement with Boundedly Rational Actors Christine Jolls Chapter 12The Biology of Irrationality: Crime and the Contingency of Deterrence Michael O'Neill Chapter 13Analyzing Illicit Drug Markets When Dealers Act With Limited Rationality Jonathan Caukins and Robert J. MacCoun Chapter 14On the Psychology of Punishment Cass Sunstein Chapter 15Some Well-Aged Wines for the "New Norms" Bottles: Implications of Social Psychology for Law and Economics Yuval Feldman and Robert MacCoun Part IVIrrational Behavior and the Design of Law Chapter 16Human Fallibility and the Forms of Law: The Case of Traffic Safety Thomas Ulen Chapter 17The Free Radicals of Tort Mark Grady Chapter 18Probability Errors: Some Positive and Normative Implications for Tort and Contract Law Eric Posner Chapter 19Threatening an Irrational Breach of Contract Oren Bar-Gill and Omri Ben-Shahar Chapter 20Regulating Irrational Exuberance and Anxiety in Securities Markets Peter Huang Chapter 21In Praise of Investor Irrationality Jeffrey Rachlinski and Gregory LeBlanc Index

"Progressive law scholars will want to read this lively, wide-ranging, and fun collection. The impressive cast of contributors keeps a clear eye on how law can be informed by formal models of limits on rationality." -Colin F. Camerer,Axline Professor of Business Economics, California Institute of Technology

Francesco Parisi is Professor of Law and Director, Law and Economics Program, George Mason University School of Law. He is co-editor of The Law and Economics of the European Union (2003), Economic Foundations of Private Law (2002), and Law and Economics (1997). Vernon Smith is Nobel Laureate in Economics, 2002, and Professor of Economics and Law, George Mason University.

• CONTENTS Acknowledgments Contributors Introduction Francesco Parisi and Vernon Smith Part IIrrationality and Bounded Rationality in Law, Psychology and Economics Chapter 1Departures from Rational Choice: With and Without Regret Robert Frank Chapter 2Is the Mind Irrational or Ecologically Rational? Gerd Gigerenzer Chapter 3Lessons from Neuroeconomics for the Law Kevin McCabe, Vernon Smith, and Terrence Chorvat Chapter 4Treating Yourself Instrumentally: Internalization, Rationality and Law Robert Cooter Part IIThe Economics of Irrational Behavior Chapter 5Addition, Choice and Irrationalit Ole Skog Chapter 6Revenge and Retaliation Vincy Fon and Francesco Parisi Chapter 7What Makes Trade Possible? Elizabeth Hoffman, Kevin McCabe, and Vernon Smith Chapter 8Satisfaction and Learning: An Experimental Game to Measure Happiness Marco Novarese and Salvatore Rizzello, Chapter 9The Market for Laughter F.H. Buckley Part IIIThe Jurisprudence of Irrational Behavior: Rethinking Law as Behavioral Instrument Chapter 10The Jurisprudence of Craziness Stephen Morse Chapter 11On Law Enforcement with Boundedly Rational Actors Christine Jolls Chapter 12The Biology of Irrationality: Crime and the Contingency of Deterrence Michael O'Neill Chapter 13Analyzing Illicit Drug Markets When Dealers Act With Limited Rationality Jonathan Caukins and Robert J. MacCoun Chapter 14On the Psychology of Punishment Cass Sunstein Chapter 15Some Well-Aged Wines for the "New Norms" Bottles: Implications of Social Psychology for Law and Economics Yuval Feldman and Robert MacCoun Part IVIrrational Behavior and the Design of Law Chapter 16Human Fallibility and the Forms of Law: The Case of Traffic Safety Thomas Ulen Chapter 17The Free Radicals of Tort Mark Grady Chapter 18Probability Errors: Some Positive and Normative Implications for Tort and Contract Law Eric Posner Chapter 19Threatening an Irrational Breach of Contract Oren Bar-Gill and Omri Ben-Shahar Chapter 20Regulating Irrational Exuberance and Anxiety in Securities Markets Peter Huang Chapter 21In Praise of Investor Irrationality Jeffrey Rachlinski and Gregory LeBlanc Index

"Progressive law scholars will want to read this lively, wide-ranging, and fun collection. The impressive cast of contributors keeps a clear eye on how law can be informed by formal models of limits on rationality." -Colin F. Camerer,Axline Professor of Business Economics, California Institute of Technology

Francesco Parisi is Professor of Law and Director, Law and Economics Program, George Mason University School of Law. He is co-editor of The Law and Economics of the European Union (2003), Economic Foundations of Private Law (2002), and Law and Economics (1997). Vernon Smith is Nobel Laureate in Economics, 2002, and Professor of Economics and Law, George Mason University.

• CONTENTS Acknowledgments Contributors Introduction Francesco Parisi and Vernon Smith Part IIrrationality and Bounded Rationality in Law, Psychology and Economics Chapter 1Departures from Rational Choice: With and Without Regret Robert Frank Chapter 2Is the Mind Irrational or Ecologically Rational? Gerd Gigerenzer Chapter 3Lessons from Neuroeconomics for the Law Kevin McCabe, Vernon Smith, and Terrence Chorvat Chapter 4Treating Yourself Instrumentally: Internalization, Rationality and Law Robert Cooter Part IIThe Economics of Irrational Behavior Chapter 5Addition, Choice and Irrationalit Ole Skog Chapter 6Revenge and Retaliation Vincy Fon and Francesco Parisi Chapter 7What Makes Trade Possible? Elizabeth Hoffman, Kevin McCabe, and Vernon Smith Chapter 8Satisfaction and Learning: An Experimental Game to Measure Happiness Marco Novarese and Salvatore Rizzello, Chapter 9The Market for Laughter F.H. Buckley Part IIIThe Jurisprudence of Irrational Behavior: Rethinking Law as Behavioral Instrument Chapter 10The Jurisprudence of Craziness Stephen Morse Chapter 11On Law Enforcement with Boundedly Rational Actors Christine Jolls Chapter 12The Biology of Irrationality: Crime and the Contingency of Deterrence Michael O'Neill Chapter 13Analyzing Illicit Drug Markets When Dealers Act With Limited Rationality Jonathan Caukins and Robert J. MacCoun Chapter 14On the Psychology of Punishment Cass Sunstein Chapter 15Some Well-Aged Wines for the "New Norms" Bottles: Implications of Social Psychology for Law and Economics Yuval Feldman and Robert MacCoun Part IVIrrational Behavior and the Design of Law Chapter 16Human Fallibility and the Forms of Law: The Case of Traffic Safety Thomas Ulen Chapter 17The Free Radicals of Tort Mark Grady Chapter 18Probability Errors: Some Positive and Normative Implications for Tort and Contract Law Eric Posner Chapter 19Threatening an Irrational Breach of Contract Oren Bar-Gill and Omri Ben-Shahar Chapter 20Regulating Irrational Exuberance and Anxiety in Securities Markets Peter Huang Chapter 21In Praise of Investor Irrationality Jeffrey Rachlinski and Gregory LeBlanc Index

"Progressive law scholars will want to read this lively, wide-ranging, and fun collection. The impressive cast of contributors keeps a clear eye on how law can be informed by formal models of limits on rationality." -Colin F. Camerer,Axline Professor of Business Economics, California Institute of Technology