Law And Economics And Behavioral Law And Economics : Focus On Maximizing The Rational Assumption

Law and Economics use the theoretical and analytical methods of Economics to resolve disputes and questions in the legal field and abstracts simple mathematical analysis model from the social behaviour, and carries through positive research on this basis. It has manifested the intuitive simple characteristic of economic analysis,and has promulgated the value dimension of social economy benefit goal in legal field. Law and Economics have answered how does the law in fact affect people's behavior,and what response when people face legal,why is the law like this,what should the law be that improve people's life and advance social development progress .It's only dozens of years from statement to present gradual systematization,Law and Economics has achieved present achievement and acknowledged for the common people,becuse it has it's own unique place.In order to achieve modeling analysis, Law and Economics thought that the human is its benefit maximization with the foundation of economic rational assumption.All the activities are around to meet houman's need and the material, which is abstracts complete self-interest that have the basic ability of utility computing from individual behavior in reality social life.Law and Economics research aims at individual maximization of utility goal directly,and aims at achieving the public wealth maximization ,therefore, realizes the organic unification of the two goals at last. All theories of Law and Economics are revolving the rational assumption and utility maximization.Basis for the rational assumption of utility maximization sources from the measure of utility of utilitarianism. Utilitarianism points out that person's all activities are directed the happiness and pain that constituted two relative aspects of utility,that is positive and negative utility. With the standard of calculation value in economic , Law and Economics measures specific utility coming by material utility indirectly,and considers each kind of utility with certain quantity of money under the modern economic society condition,and have the unification standard with computing the utility of behavior(cost-benefit analysis),in order to make utility analysis feasibility.Therefore,the analysis method of transaction cost constituted to the important analysis tool of rationality maximization assumption.Law and Economics has analyzed the way and tendency of social behaviour by using the research results and the method of market transaction theory,and has proposed system design which how to reduce the transaction cost, that is how to eliminate or reduce transaction cost that caused by the problems that can not be solve depend on the market only,such as monopoly,externality, provision of the public goods and so on, and promote the goal of public wealth maximization with guiding and reguleting behavior of human being.With Law and Economics developing in the field of law deeply,people have brought a lot of suspicions.It caused that the tendency of individual self-interest was promoted to the altitude of complete rational ,especially with the widespread application of economic analysis,the rationality assumption has been far away from the pattern of concrete behavior in real life.Using the results and analysis method of Behavior Economic research,Behavioral Law and Economics returns the patternizing assumption of individual behavior to the real person that have rich emotion in realistic life, in connection with the foundation of rationality maximization assumption in Law and Economics,and pointed out that the fact of emotion and non-rational has influenced individual behavior of rational assumption model tremendously,and launched a challenge against the Law and Economics.Although it has also acknowledged that rationality maximization assumption is a brief abstract,Law and Economics point out that the deviation between the reality and the simulated assumption was insufficient to impact the accuract of analysis.In fact,the behavioral deviation of widespread existence in reality tells us that the completele rationality assumption will cause some mistakes of theory,these mistakes are depart from accurate request of social science. Behavioral Law and Economics take bounded self-interest,bounded willpower and bounded rational as foundation,and combine the study method of cognition psychology,it confirmed there have many deficiencies in the simulation assumption of Law and Economics. It will be helpful to analyze problem of society and legal so as to guide people to the correct behaviour if we amend the existing theory critically, and gradually form a integrated theoretical system of Law and Economics.In connection with rational maximization assumptions of Law and Economics ,this paper carried three specific to analyze.It had proven there have some comparatively large deviation between complete rationality assumption and the real life through analyzing the behavior of people in realistic society,and build the foundation of constructing the theory of Behavior Law and Economics.At first, the different of individual preference will bring about inconsistent with appraisal of utility,and then influence the error of process and result in decision-making; Secondly,the deviation of individual cognition will causes the non-rational behavior,it will cause the judgment not to be in accordance with the facts under the psychological process of endowment effect and overconfidence etc.,and then deviate the rationality anticipated result;At last,it will affects people's behavior that interactive of society urges the individual to have the reciprocity behavior and pursuing fair.It isn't indicate the behavior of human society cannot be forecast and be followed.On the contrary, this is note that there are some laws behind of the complex behavior,that can be described and exploited. Therefore, it has also analyzed the psychology causes and social factors behind the phenomenon with pointed these deviations, and given the legal system that should be how to control and guide the behavior of people in order to reduce transaction costs in a reasonable time appropriately,to promote the goal of maximization of social wealth. As an amendment,Behavioral Law and Economics is improving and refining the Law and Economics,is the basis on theory of Law and Economics. The author believes that it will be the future development direction that the two are moving toward integration.Many theories of Behavioral Law and Economics are fragment analysis, and have not yet basis theoretical of philosophical, as it has not yet formed a complete theoretical system. The process of analysis are only at the stage of qualitative analysis ,rather than using quantitative analysis to confirm specific and falsification. So we have a lot of work to be done to complete theoretical system.Every kind of social science theory have a long process from development to perfect, we should persist the attitude of skeptical on this issue,walking along the road of Behavioral Law and Economics which has humanistic care with an open and practical approach, development and perfect of Law and Economics theory must be able to bring about new opportunities,and to solve the social reality specific issues can be able to bring about a new methodology and theoretical guidance. This is the real theme of this paper and the significance.