We contrast alternative liability rules for social control of product risks when heterogeneous consumers considering …' mispredictions vary with the prevailing liability regime. We first characterize the consumers' purchasing decision and the … equilibrium levels of safety and activity from the product's usage under no liability, strict liability, and negligence rule. We …

when the agent is protected by limited liability. In this paper, we investigate how the principal should construct the … globally incentive compatible under limited liability, if local incentive constraints are strictly satisfied. We identify …

Risk-neutral individuals take more risky decisions when they have limited liability. Risk-neutral managers may not when … acting as agents under contract and taking costly actions to acquire information before taking decisions. Limited liability …

economic theory to address this issue. We find that the relation between the appropriate compensation and the mean and median …

We focus in this paper on the effects of court errors on the optimal sharing of liability between firms and financiers …, governments and courts we show, through numerical simulations, the distortions in liability sharing between firms and financiers … firm innocent of inappropriate care) errors. This role is considered in a context where liability sharing is already …

We find experimental evidence that the decision problem of tax compliance changes if subjects’ declarations are not … picture looks more trustworthy than average. Depending on these beliefs, they may adjust their compliance decisions. Our …

We study compliance dynamics generated by a large set of behavioral rules describing social interaction in a population … cheating-auditing occurs: Intensive monitoring induces compliance, but with high compliance there is incentive for lax … monitoring; with less monitoring, compliance starts decreasing, and then there is an incentive to intensify monitoring. Thus, the …

We run a large-scale natural field experiment to evaluate alternative strategies to enforce compliance with the law … mailings, leading to a substantial increase in compliance. Among different mailing conditions a legal threat that stresses a … information about others’ behavior enhances compliance. However, the information condition has a positive effect in municipalities …