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...

In a world with risk-neutral agents, liability rules will only induce efficient behaviour if these rules impose the full (marginal) costs of an action on the parties. However, institutional restrictions or bilateral activity choices can prevent the full internalisation of costs. A mechanism is...

A basic principle of law is that damages paid by a liable party should equal the harm caused by that party. However, this principle is not correct when account is taken of litigation costs, because they too are part of the social costs associated with an injury. In this article we examine the...

Exceptions do not exist in a vacuum; in fact, exceptions to a principle are usually formed using those principles to which it is an exception. Even so, United States courts interpreting the “accident” requirement of the Montreal Convention — an exception to traditional tort law regarding...

As economic restructuring was changing many state functions, the New Zealand Law Commission under the Presidency of Sir Owen Woodhouse undertook its own review of ACC, vigorously reaffirming the Woodhouse principles in its 1988 Report, while proposing further extensions of the scheme. This...

Courts typically base compensation for loss of income in personal injury cases on either mean or median work income. Yet, quantatively, mean and median incomes are typically very different. For example, in the US median income is 65 percent of mean income. In this paper we use economic theory to...

Courts typically base compensation for loss of income in personal injury cases on either mean or median work income. Yet, quantatively, mean and median incomes are typically very different. For example, in the US median income is 65 percent of mean income. In this paper we use economic theory to...

Author concerns himself with the question whether it is desirable that law only promotes economic goals. Acceptance of Posner's wealth maximization principle implicitly leads also to acceptance of current distribution of wealth and income. Calabresi doubts that acceptance of the latter is...

Little is known about the economics of plaintiff-side law firms, which typically work on a contingency fee basis. We begin here to fill that gap. We report on the fees received by 124 plaintiff-side personal injury firms located in four states (Illinois, Texas, and two additional undisclosed...

In a world with risk-neutral agents, liability rules will only induce efficient behavior if these rules impose the full (marginal) costs of an action on the parties. However, institutional restrictions or bilateral activity choices can prevent the full internalization of costs. A mechanism is...