Polinsky, A. Mitchell; Che, Yeon-Koo - In: RAND Journal of Economics 22 (1991) 4, pp. 562-570
A "decoupled" liability system is one in which the award to the plaintiff differs from the payment by the defendant. The optimal system of decoupling makes the defendant's payment as high as possible. Such a policy allows the award to the plaintiff to be lowered, thereby reducing the plaintiff's...