This paper formally analyzes strict liability and negligence in a market setting. The discussion emphasizes the impact …

clinical trials designed to ensure drug safety and efficacy, and the liability system, which allows patients to sue … safety of medical products, and conclude that product liability exemptions for FDA regulated activities could raise economic … efficiency. We show that while reductions in liability, such those associated with pre-emption, may lower welfare in the absence …

national firm upstream and improved or distributed by local firms downstream. In this context, heightened products liability … may have unintended consequences for consumer safety. Conventional wisdom holds that an increase in tort liability on the … worse, if liability is shared between upstream and downstream firms, higher upstream liability may decrease the liability of …

This paper compares alternative liability rules for allocating losses from defective products when consumers under … liability .leads to both the first-best accident probability and industry output. If producers do have some market power, strict … liability still leads to the first-best accident probability, but there will now be too little output of the industry. It is …

Liability laws designed to compensate for harms caused by defective products may also affect innovation. We examine … this issue by exploiting a major quasi-exogenous increase in liability risk faced by US suppliers of polymers used to … manufacture medical implants. Difference-in-differences analyses show that this surge in suppliers' liability risk had a large and …

someone else? We show that if consumers have deep pockets then manufacturer liability is not economically efficient. It is … have limited assets, then the most efficient rule is "residual-manufacturer liability" where the manufacturer pays the … shortfall in damages not paid by the consumer. Residual-manufacturer liability distorts the market quantity when consumers …

We examine the relationship between product liability litigation and innovation by systematically combining data on … product liability lawsuits with data on new product introductions in a panel dataset of leading medical device firms. We first … suggest that product liability litigation affects the rate and direction of technological progress, and that safety regulation …

Because the optimal level of medical malpractice liability depends on the incentives provided by the health insurance … system, the rise of managed care in the 1990s may affect the relationship between liability reform and defensive medicine. In … this paper, we assess empirically the extent to which managed care and liability reform interact to affect the cost of care …