The Consumer Protection Ecosystem: Law, Norms, and Technology

Abstract

In recent years, the tools consumers use to buy and borrow have changed radically. New technologies for advertising, contracting, and transacting have proliferated, and so have fierce policy debates on issues such as identity theft and online privacy; arbitration clauses and class action lawsuits; and Americans’ accumulation of debt and the unsavory practices sometimes used by collectors of it. Facing these realities, scholars, policymakers, and advocates have devoted increasing energy to this area of law. Despite its prominence, confusion persists regarding what consumer protection really is or does. Though much discussed, it remains undertheorized. In particular, analysis of consumer law and policy has not sufficiently taken account of the implications of social and technological change.

This Article constructs a new model of the consumer protection ecosystem by contextualizing purely legal constraints amid the other realities of commercial relationships. Drawing on scholarship in the areas of technology, social change, and law, the model lays out three basic types of constraints on the activities of participants in consumer commercial transactions: legal, technical, and social. This model provides a basis for exploring how those constraints interact and shape behavior.

The model has significant ramifications for scholars, policymakers, and advocates. It underscores why the area of consumer commerce defies one-size-fits-all solutions: good policies require not only consideration of consumers, merchants, and the commercial relationships they pursue, but of the dynamic social and technological contexts of those relationships. For instance, when technology opens unexpected new areas of feasible conduct, both law and social norms may lag behind in their ability to constrain its socially undesirable aspects. Focused, public deliberation and increased regulatory attention may be merited at least until social norms have developed to define the acceptable contours of such conduct. This Article provides a more refined and inclusive framework for future research and debate.

Keywords: consumer law, law and technology, sociolegal studies, consumer finance, privacy law

JEL Classification: K12, K11, K32, D11, D14