Justifications for the use of punitive damages refer to deterrence and punishment. After formulating a social welfare function that incorporates both economic efficiency and a desire for retribution, optimal punitive damages are considered to balance concerns for economic efficiency and for...

This is a Review of Guido Calabresi’s fascinating and thought-provoking new book, The Future of Law and Economics (presented in a book symposium held at the Hebrew University of Jerusalem in December 2016). The Review proposes to break the notion of commodification, as used by Calabresi, into...

Under the doctrine of vicarious liability, a deep-pocket principal is often held responsible for a third-party harm caused by a judgment-proof agent's negligence. We analyze the incentive contract used by the principal to control the agent's behavior when a court can make an error in determining...

This entry for the forthcoming The New Palgrave Dictionary of Economics (Second Edition) surveys the economic analysis of five primary fields of law: property law; liability for accidents; contract law; litigation; and public enforcement and criminal law. It also briefly considers some...

Does a more risk-averse individual put greater effort to abide by legal rules than the less risk-averse? Or are the criminals really a race apart who is exceptionally risk prone? This paper examines the relationship between the law-abiding effort of an individual and his degree of risk aversion....

This paper presents a model of penalties that reconciles the conflicting accounts optimal punishment by Becker, who argued penalties should internalize social costs, and Posner, who suggested penalties should completely deter offenses. The model delivers specific recommendations as to when...

A century ago, captains of industry and their allies in government launched a social experiment in urban America: the abandonment of mass transit in favor of a new personal technology, the private automobile. Decades of investment in this shift have created a car-centric landscape with...

This working paper provides an overview of the concept and practice of forensic economics by discussing four questions concerning the domain of this discipline. The first question asks whether forensic economics is a practical or academic enterprise, or both. The second one concerns the types of...