Consumer Mindset

From contracts to AI, Oren Bar-Gill explores how cognitive biases affect economic decision-making.

Oren Bar-Gill

is unequivocal about his reason for returning to Law as a fulltime faculty member. “I love the people at ,” Bar-Gill says. “I realized that I missed them and that I wanted to be back.” 

Bar-Gill rejoined the Law faculty in July after spending 11 years at Harvard Law School, where he held the William J. Friedman and Alicia Townsend Friedman Professorship of Law and Economics. From 2005 to 2014, he taught at Law, holding the Evelyn and Harold Meltzer Professorship of Law and Economics.

“Oren is one of the foremost scholars in law and economics, whose groundbreaking work has significantly advanced our understanding of contracts and consumer markets,” Dean ’00 says. “His return to will further strengthen the expertise of our private law group and enrich our entire community with his scholarship, teaching, and collaborative spirit.”

“Oren is one of the foremost scholars in law and economics, whose groundbreaking work has significantly advanced our understanding of contracts and consumer markets,”  says Dean Troy McKenzie ’00.

Bar-Gill’s pioneering research explores how bounded rationality and cognitive biases shape contractual decision-making, particularly in consumer markets. His influential book, (Oxford University Press, 2013), is viewed as a landmark contribution to the field. Bar-Gill holds a BA in economics, an LLB, an MA in law and economics, and a PhD in economics from Tel Aviv University, as well as an LLM and an SJD from Harvard Law School. Among his many honors are the American Law Institute’s Young Scholars Medal and the American Law and Economics Review’s Best Paper Prize for a paper he co-authored with Kevin Davis, Beller Family Professor of Business Law

 In May, Bar-Gill and Harvard Law’s Cass Sunstein published Algorithmic Harm: Protecting People in the Age of Artificial Intelligence (Oxford). The book assesses the benefits and harms algorithms pose for consumers and workers, and discusses possible regulatory responses to reduce risk. While companies have long mined data to market tailored offerings or pricing to individuals, “the use of AI and the data that fuels it enable a whole new level of differentiation that we haven’t seen before,” Bar-Gill says. Some differentiation may be beneficial: providing someone with information about a product that meets their specific needs, for example. But Bar-Gill emphasizes that one can also imagine dystopian scenarios, such as combining information from a person’s facial images and text messages to determine that they are emotionally vulnerable and susceptible to offers that are not to their benefit.

Another recent undertaking for Bar-Gill was serving as a reporter for the American Law Institute’s , published in 2024. Unlike ALI’s existing Restatement on contract law, this one focuses specifically on the types of contracts now ubiquitous in everyday life, such as those for software or streaming subscriptions. It was gratifying, Bar-Gill says, to draw on his scholarship to produce something “which has the potential to actually affect the way courts make decisions and life beyond the ivory tower.” The “less exciting part,” he says, was the acrimony encountered during the drafting process. He and his co-reporters were “vigorously attacked from both the left and the right,” he says, for being insufficiently or overly protective of consumers, “and these politics are not something I enjoy.”

One of Bar-Gill’s co-reporters—along with Omri Ben-Shahar of the University of Chicago Law School—was ’01, Boxer Family Professor of Law at Law. Bar-Gill and Marotta-Wurgler have worked together on multiple projects, and she is one of the many faculty members whom he says he’s looking forward to having again as a down-the-hall colleague.

“I am thrilled to welcome Oren back to the faculty,” Marotta-Wurgler says. “He is a brilliant teacher, scholar, and valuable member of our community. We missed him, and we are delighted to have him back.” —Michael Orey

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