Little is known about consumer response to food safety recalls in low- and middle- income countries. Using an event-study framework, this paper examines the immediate and long-term changes in noodle purchases after the nationwide removal of Maggi instant noodles from the market in India in 2015....

This article compares the classic liability rules, negligence and strict liability, under the hypothesis that injurers and victims formulate subjective beliefs about the probabilities of harm. Parties may reasonably disagree in their assessment of the precautionary measures available: a measure...

Products liability in the digital age entails reckoning with the transformative shift away from in-person purchases from brick-and-mortar stores toward digital purchases from e-commerce platforms. The epochal rise of the online storefront has vastly expanded the prevalence of direct-to-consumer...

In the manuscript I derive a fundamental quantitative model of normal legal behavior in liability law and describe how deviating from this behavior results in liability in an abstract world where unlawful damage should be minimalized. I start with a logical model in a deterministic world and...

Dangerous products may give rise to colossal liability for commercial actors. Indeed, in 2021, the U.S. Supreme Court denied certiorari in Johnson & Johnson v. Ingham, permitting a more than two billion dollar products liability damages award to stand. In his dissenting opinion in another recent...

Dogs have been regarded as friends by humans for generations. But what about the culpability for the harm caused by dogs. At different instances case laws show that dogs have caused the most significant harms. Tort law developed from an early position of owner-friendly laws to victim centric by...

When a consumer purchases a product based on the influence of a brand ambassador acting as an endorser, should such brand ambassador be held liable when the product is defective? These questions have been lingering in the legal space because of the power and influence a brand ambassador...

The purpose of this paper is to assess the applicability of the Product Liability Directive concerning the liability for defective products to the realm of the Internet of Things (IoT). This Directive has proved to be an effective tool both in addressing cases of defective products and in...

Product-recall data and information on stock-price reactions to recalls are used to estimate the value of reputation in a model in which product quality is not contractible. A recall is the result of a product defect that signals low effort. The recall triggers a reduction in the firm's product...

We study a platformâs incentives to delist IP-infringing products and the effects of holding the platform liable for the presence of such products on innovation and consumer welfare. For a given number of buyers, platform liability increases innovation by reducing the competitive pressure faced...

Amazon, and other internet sales platforms, have revolutionized the manner in which goods are purchased and sold. The obligations undertaken by Amazon in those sales are unclear, both as a matter of transparency, and as a matter of legal doctrine. Is Amazon a store? Is it a shipper? Is it a...

Public authorities in many jurisdictions are concerned about the proliferation of illegal content and products on online platforms. In this paper, we provide an economic appraisal of platform liability that highlights the effects of a stricter liability rule on several key variables such as...

The large number of recalled products, the low proportion of recalled products returned for repair or replacement, and the high costs (lawsuits, communication, product repair and/or replacement, government agency fines and lost sales, etc.) associated with product recalls indicate the need for...

Financial innovation provides an accommodating avenue for parties to develop strategic means to prevent or avoid risk by spreading it across the financial system through efficient transferral to other parties. This transferral is done in numerous ways, the most notorious of which is through...

We study an e-commerce platform’s incentives to delist IP-infringing products and the effects of introducing a liability regime that induces the platform to increase its screening intensity. We identify conditions under which platform liability is socially desirable (respectively, undesirable)...

This paper considers product recall under a perfect regime of strict liability. We show that safety is under supplied given output due to an under internalization of infra-marginal units. If we add a mandatory refund with a possible penalty fee in the event that the product turns out to be...

This paper formally analyzes strict liability and negligence in a market setting. The discussion emphasizes the impact of the rules on the market price and on the number of firms in the industry. For simplicity, the damage caused by each firm is assumed to be determined only by that firm's...

Over the past decade, the rise of online marketplaces such as Amazon.com has profoundly changed the retail landscape. The current pandemic has further accelerated consumers’ shift towards online buying in general and online marketplaces in particular. As a result, traditional distribution...

The 21st Century Cures Act confirmed the FDA’s authority to regulate certain categories of software that, increasingly, incorporate artificial intelligence/machine learning (AI/ML) techniques. The agency’s September 27, 2019 draft guidance on Clinical Decision Support Software proposed an...

An ELI Innovation Paper seeks to set out concrete propositions for European Legal Development in a short paper, which is more tentative in nature and which does not represent the result of comprehensive research; rather, it seeks to spark discussion and to inspire further action. In this spirit,...

Should the manufacturer of a product be held legally responsible when a consumer, while using the product, harms someone else? We show that if consumers have deep pockets then manufacturer liability is not economically efficient. It is more efficient for the consumers themselves to bear...

We describe how product liability interacts with regulatory product approval in influencing a firm's incentives to acquire information about product risk, using a very parsimonious model. The firm may have insufficient information acquisition incentives when it is not fully liable for the harm...

We analyze a monopolist who offers different variants of a possibly dangerous product to heterogeneous customers. Product variants are distinguished by different safety attributes. Customers choose product usage which co- determines expected harm. We find that, even with customers being...

Throughout its rise from startup bookseller to the world's most valuable company, Amazon has managed to disrupt nearly every aspect of the twentieth-century retail model. Its website now accounts for over half of all online shopping in the United States, acting as a literal “Everything...

This Article explores four beliefs about supposed pharma-benevolence that appear to be shared by more than the industry, reaching the level almost of conventional wisdom. These figurative pillars help support one-sided results in court. However, each of the pillars on examination turns out at...

The ten states now comprising the Association of Southeast Asian Nations (ASEAN) have collectively become a major part of the world economy, bringing together over 600 million people including a growing middle class. Yet they are highly diverse in socio-economic development, political structure...

Two chapters from the third edition of Principles of Products Liability (Foundation Press 2020), a state-of-the-art study of products liability. The book shows how ancient laws have evolved into liability rules capable of solving the safety questions raised by new or emerging technologies,...

We analyze in a two-phase model the optimal mix of ex ante experimentation and ex post learning for the dynamic adoption of activities with uncertain payoffs. In a first pre-introduction phase, costly experimentation is undertaken to decide whether to adopt the activity or abandon...

This paper describes the incentives for firms to seek voluntary product safety certifications. We consider a firm which makes the decision of whether or not to seek certification prior to selling the product. We show that, even when the firm and the consumers have same beliefs about the product...