In this paper, we study contracts with two-sided incomplete information. Prior literature on contract remedies does not formally account for the nonbreaching party's option to not sue for damages upon breach, when her expected payoff from suing is negative, given the contractual terms and her...

We evaluate the effect of tort reform on employer-sponsored health insurance premiums by exploiting state-level variation in the timing of reforms. Using a dataset of healthplans representing over 10 million Americans annually between 1998 and 2006, we find that caps on non-economic damages,...

The healthcare system is sick. The players are incentivized to maximize their own benefit and externalize their costs onto the other parties. This paper examines the warped incentives that underlie the system. The Tort system, lacking expertise and slow to adapt, is unable to overcome lack of...

In this paper I propose implementing a “private regulation regime” for healthcare which would realign health care providers’ incentives so as to significantly reduce the healthcare system’s three major cost drivers: medical errors, defensive medicine and offensive medicine. The private...