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Yuval Feldman, Yotam Kaplan & Henry E. Smith, Motivating Equity (Bar Ilan University Faculty of Law Research Paper No. 5139971, 2025).


Abstract: This Article offers a novel perspective on the distinction between law and equity, challenging the prevailing consensus that favors their fusion. Drawing on insights from behavioral science and compliance theory, we propose that the separation of law and equity serves a crucial function by allowing for nuanced messaging that can enhance overall compliance with legal norms. Contemporary scholarship sees the law-equity divide as an anachronistic remnant, with commentators generally advocating for a unified system. However, this Article argues that maintaining a dual structure enables the legal system to calibrate its approach, sometimes emphasizing formal legal reasoning and at other times incorporating moral considerations. This flexibility, we contend, allows the legal system to navigate the complex relationship between law and morality in ways that can positively influence compliance behavior. By exploring the previously unexamined connection between equity and compliance theory, we demonstrate how this dual system can mitigate issues such as crowding out and ethical numbing. Our analysis brings law and behavioral ethics together to contribute to the literature on legal design and the expressive function of law, offering a more sophisticated understanding of how legal structures can be tailored to enhance compliance in various contexts. This theoretical framework not only provides a functional explanation for the persistence of equity in modern legal systems but also suggests new avenues for research in legal theory and compliance studies.