Adapt or Optimize? The Psychology and Economics of Rules of Evidence

Robert D. Cooter, University of California, Berkeley

Abstract

In civil disputes, the plaintiff must prove his case by the preponderance of the evidence. To reach this standard, the plaintiff accumulates evidence by combining facts. In this chapter, two models of this process are compared. First, decision makers can adapt their behavior for improved results, as assumed in some psychological models. Adaptive models predict that court practice will allow the plaintiff to combine facts according to relatively simple rules. Second, decision makers can optimize their behavior for best results, as assumed in most economic models. Optimization models predict that court practice will require the plaintiff to combine facts in ways that conform to the laws of probability theory. Predictions from these two models contradict each other when simple, adaptive rules violate the laws of probability theory. It is shown that actual practice in a California court allows the plaintiff to combine facts according to relatively simple rules that sometimes violate the laws of probability theory. Adaptation is, consequently, a better descriptive theory than optimization. Procedures that violate the laws of probability theory, however, are vulnerable to criticism. Given that trials proceed with deliberate speed under expert guidance, suboptimal adaptations are irrational. Optimization, consequently, is a better normative theory than adaptation.