This paper establishes that tort damages multipliers higher than one can be an instrument to induce imperfectly competitive producers to invest in product safety at socially optimal levels. In their selection of product safety levels, producers seek to maximize profits, neglecting the fact that...

We examine the link between innovative activity on the part of firms, the competitive pressure to introduce innovations, and optimal damages awards. While innovative activity brings forth valuable new products for consumers, competitive pressure in the ensuing innovation race induces firms to...

This paper establishes that tort damages multipliers higher than one can be an instrument to induce imperfectly competitive producers to invest in product safety at socially optimal levels. In their selection of product safety levels, producers seek to maximize profits, neglecting the fact that...

In this paper, we examine the link between innovative activity on the part of firms, the competitive pressure to introduce innovations and optimal damages awards. While innovative activity brings forth valuable new products for consumers, competitive pressure in the ensuing innovation race...

This paper explores the impact of product liability on vertical product differentiation when product safety is perfectly observable. In a two-stage competition, duopolistic firms are subject to strict liability and segment the market such that a low-safety product is marketed at a low price to...

In the economic analysis of liability law, information about accident risk and how it can be influenced by precautions is commonly taken for granted. However, a profound understanding of the relationship between care and accident risk often requires learning-by-doing. In a two-period model, we...

Diese Arbeit beinhaltet eine Untersuchung der Effekte einer einheitlichen Anwendung der Gefährdungshaftung als Grundprinzip der Produkthaftung bei länderübergreifendem Handel. Der Schwerpunkt der Analyse basiert auf einem Rahmen unvollkommenen Wettbewerbs bei heterogenen Konsumenten und...

This article shows that it may be socially optimal to grant accident victims less than full compensation. In our framework, firms are liable under product liability but also invest in care to prevent consumers switching to competitors. Affecting the partition of consumers by means of care-taking...

We analyze liability law when the value of the good at risk has an influence on the consumer's social status. It is first established that standard liability rules fail to induce efficient choices. We argue that standard negligence will tend to outperform standard strict liability. Next, we...

This paper explores the impact of product liability on vertical product differentiation when product safety is perfectly observable. In a two-stage competition, duopolistic firms are subject to strict liability and segment the market such that a low-safety product is marketed at a low price to...