clinical trials designed to ensure drug safety and efficacy, and the liability system, which allows patients to sue … safety of medical products, and conclude that product liability exemptions for FDA regulated activities could raise economic … efficiency. We show that while reductions in liability, such those associated with pre-emption, may lower welfare in the absence …

plays an important role in the choice between liability rules. Specifically, positively correlated harms favor a liability … liability rule that pools risks together, as in strict liability. The same applies when parties can purchase costly insurance … (first party or third party). This policy recommendation is in line with current products liability law, which places design …

This paper analyzes the workings of liability when harm-inflicting consumers are present biased and both product safety … the manufacturer, in stark contrast with the baseline scenario in which strict consumer liability induces socially optimal … product safety and precaution levels. In addition, we establish that strict liability with contributory negligence may induce …