BEHAVIORAL LAW AND ECONOMICS

Abstract

Issues concerning the regulation aspects of financial markets are not simple. One of the reasons for this is that a great number of detailed factors have an effect, for example, the trust of the consumers of financial services or their behavior . The paper analyses the most important of them, and issues related to them, from a legal point of view, with the main objective of presenting the basic assumptions of the behavioral Law & Economicstheorem. Dynamic development of financial markets and instruments available in those markets requires thecollaboration of economists and lawyers working out legal provisions that will 'understand' the economic nature of the matters they regulate. Moreover law and economics analysis on the matter may be improved by increased attention to insights about human behavior.