This paper analyzes liability rules when consumers and third parties/the environment incur harm. Expected harm is convex in the level of output and modeled as a power function. We show that the social ranking of liability rules previously established for the case in which only consumers suffer...

This paper analyzes the workings of liability when harm-inflicting consumers are present biased and both product safety and consumer care influence expected harm. We show that present bias introduces a rationale for shifting some losses onto the manufacturer, in stark contrast with the baseline...

In this paper, we examine the influence of medical malpractice tort reform on the level of private health insurance company losses incurred. We employ a natural experiment framework centered on a series of tort reform measures enacted in Texas in 2003 that drastically altered the medical...

The present system for reparation of very large oil accidents at sea neither gives incentives to take efficient care, nor allow for compensation of all damages. The reason is that the magnitudes of the accidents that we study are so big that the total assets of the injurer are not sufficient to...

This paper analyzes liability rules when consumers and third parties/the environment incur harm. Expected harm is convex in the level of output and modeled as a power function. We show that the social ranking of liability rules previously established for the case in which only consumers suffer...

Storm-related service outages in electricity and telecommunications have created public controversies regarding the adequacy of ex ante efforts to prevent outages and ex post efforts to restore power. Product liability rules, used to promote quality of service throughout the economy, might seem...

This paper compares the impacts of a penalty on accident and a per-unit tax on output, when social damages depend on the output of firms. The choice of the optimal regulation, aiming at internalizing a damage, is influenced both by the market power of firms and by their potential (in)solvency in...

Reasons for the joint use of ex ante regulation and ex post liability to cope with environmental accidents have been a longstanding issue in law and economics literature. This article, which includes the first empirical study of the French environmental legal system, analyzes courts’ decisions...

The key question in this paper is to determine whether regulation and regulators information can help solving causal uncertainty problems in liability. A widely held view among Law & Economics scholars is that civil liability alone is not well-suited to cope with environmental accidents,...

We use spatial simulation techniques to estimate both cross pollination damages and net producer benefit from genetically modified (GM) oilseed rape under alternative information requirements about individual farmers' cropping plans. Simulations were carried out for two study regions in Germany....