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Decision Making Under the Gambler’s Fallacy: Evidence from Asylum Judges, Loan Officers, and Baseball Umpires *

Quarterly Journal of Economics 2016 131(3), 1181-1242 open access
We find consistent evidence of negative autocorrelation in decision making that is unrelated to the merits of the cases considered in three separate high-stakes field settings: refugee asylum court decisions, loan application reviews, and Major League Baseball umpire pitch calls. The evidence is most consistent with the law of small numbers and the gambler’s fallacy—people underestimating the likelihood of sequential streaks occurring by chance—leading to negatively autocorrelated decisions that result in errors. The negative autocorrelation is stronger among more moderate and less experienced decision makers, following longer streaks of decisions in one direction, when the current and previous cases share similar characteristics or occur close in time, and when decision makers face weaker incentives for accuracy. Other explanations for negatively autocorrelated decisions such as quotas, learning, or preferences to treat all parties fairly are less consistent with the evidence, though we cannot completely rule out sequential contrast effects as an alternative explanation.

Ideas Have Consequences: The Impact of Law and Economics on American Justice

Quarterly Journal of Economics 2026 141(1), 845-887 open access
This article empirically studies the effects of the early law and economics movement on the U.S. judiciary. We focus on the Manne Economics Institute for Federal Judges, an intensive economics course that trained almost half of federal judges between 1976 and 1999. Using the universe of published opinions in U.S. Circuit Courts and 1 million District Court criminal sentencing decisions, we estimate the within-judge effect of Manne program attendance. Selection into attendance was limited, as the program was popular among judges of all backgrounds, frequently oversubscribed, and admitted participants on a first-come, first-served basis. We find that after attending economics training, participating judges use more economics language in their opinions, rule against regulatory agencies more often, and impose more severe criminal sentences. We argue that economics, as a rigorous social science, was especially effective in persuading judges.