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...

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...

We investigate how third-party punishers and potential violators decide under evidentiary uncertainty in a take game. In line with the legal requirement and in contrast to economic models, neither the sanction nor the harm level affects the punishment probability, but the quality of evidence...