On the Redesign of Accident Liability for the World of Autonomous Vehicles

This article studies a model of liability for automobile accidents in the coming world in which automobiles will be autonomous. In that world, travelers will not be drivers, rendering liability premised on driver fault irrelevant as a means of reducing accident dangers. Moreover, no other conventional principle of individual or of manufacturer liability would serve well to do so. Indeed, in the model considered, strict manufacturer liability, recommended by many commentators, would actually tend to leave accident risks unchanged from their levels in the absence of liability. However, a new form of strict liability––the hallmark of which is that damages would be paid to the state––would be superior to conventional rules of liability in alleviating accident risks and would be easy to administer.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at "http://www.nber.org/papers/w26220"