Preference change and behavioral ethics: Can states create ethical people?

Law and economics scholarship suggests that, in appropriate cases, the law can improve people's behavior by changing their preferences. For example, the law can curb discriminatory hiring practices by providing employers with information that might change their discriminatory preference. Supposedly, if employers no longer prefer one class of employees to another, they will simply stop discriminating, with no need for further legal intervention. The current Article aims to add some depth to this familiar analysis by introducing the insights of behavioral ethics into the law and economics literature on preference change. Behavioral ethics research shows that wrongdoing often originates from semi-deliberative or non-deliberative cognitive processes. These findings suggest that the process of preference change through the use of the law is markedly more complicated and nuanced than previously appreciated. For instance, even if an employer's explicit discriminatory stance is changed, and the employer no longer consciously prefers one class of employees over another, discriminatory behavior might persist if it originates from semi-conscious, habitual, or non-deliberative decision-making mechanisms. Therefore, actual change in behavior might necessitate a close engagement with people's level of moral awareness. We discuss the institutional and normative implications of these insights and evaluate their significance for the attempt to improve preferences through the different functions of the legal system.