Product liability has acquired immense importance in the last 50 years. Various studies show that when consumers are imperfectly informed about the product related risk, the market mechanism will not lead to an efficient outcome and tort liability is required for economic efficiency. Many...

Efficiency property of liability rules when courts make errors in estimation of the harm suffered by the victim is studied. Effects of courts' errors on parties' behaviour regarding the levels of care they take to prevent the accident and their decisions to buy information about courts' errors...

In standard models dealing with liability rules, generally, the proportion of accident loss a party is required to bear does not depend upon the 'causation' - the extent to which the care or lack of care on the part of the party contributed to the loss. As a matter of legal doctrine, this...

A liability rule determines whether and how much damage (liability) payments are to be made by the injurer(s) to the victim(s) of an accident. Damage awards are critical for the efficiency or otherwise of liability rules. One of the factors affecting damage awards and, as a consequence,...

A growing body of literature suggests that courts and juries are inclined toward division of liability between two strictly non-negligent or “vigilant” parties. However, standard models of liability rules do not provide for vigilance-based sharing of liability. In this paper, we explore the...

Risky products cause two types of costs for society; the accident costs and the insurance costs. Liability rules allocate these costs between the parties involved. The expansion in the scope of product liability over the past thirty years has increased the cost of third-party liability...