This paper analyzes the output, abatement, and investment decisions made by a monopolistic polluter under environmental liability law. The model applied considers both integrated and end-of-pipe abatement technologies. We find that in the case of fixed technology, in many instances negligence...

Consumers increasingly care about firms' ethical conduct (e.g., labor and environmental practices) when making their consumption choices. This note presents a simple framework to highlight the possibility that this development may induce a less desirable production technology choice and bring...

We analyze experimental data to assess whether the deterrent effect of expected fines depends on who receives the fines' proceeds. We compare behavior in treatments when the revenue is a reward for enforcement agents to the alternative when fines are transferred to society at large. Most...

We study whether it is socially desirable to hold a monopolistic firm liable for the harm its potentially judgment-proof consumers inflict on third parties. Consumers' judgment-proofness limits potential product differentiation by pooling different consumer types with uniform liability exposure....

Die deutsche Teilung nach dem Zweiten Weltkrieg dient als natürliches Experiment, um die Frage zu be - antworten, ob sich politische Institutionen auf die Präferenzen von Individuen bezüglich des Konsums von Statusgütern auswirken. Die Analyse des Ausgabeverhaltens hat bedeutende...

Extending previous “tales of two market failures”, we consider a setting in which firms generate environmental externalities and may invest in environmentally friendly technological advancement generating R&D spillovers. We analyze the joint use of environmental liability law and R&D...

One of the great successes of the law and economics movement has been the use of economic models to explain the structure and function of broad areas of law. The original contributions to this volume epitomize that tradition, offering state-of-the-art research on the many facets of economic...

This note establishes that escalating penalty regimes with the option to self-report crimes may allow present-biased offenders to obligate themselves to refrain from committing future crimes. Self-reporting of a committed crime increases the expected costs of future criminal opportunities,...

This article shows that it may be socially optimal to grant accident victims less than full compensation. In our framework, firms are liable under product liability but also invest in care to prevent consumers switching to competitors. Affecting the partition of consumers by means of care-taking...