Class Notes (837,550)
Canada (510,314)
Economics (1,590)
ECO320H1 (30)
Lecture

Textbook Notes- Chapter 9 Topics in the Economics of Tort Liability

8 Pages
98 Views
Unlock Document

Department
Economics
Course
ECO320H1
Professor
Robert Barber
Semester
Fall

Description
Chapter 9 J Topics in the Economics of Tort Liability Goal of Tort: minimize sum of cost of harm form accidents, costs of avoiding accidents, and costs of admin. Core Assumptions: 1. Rationality J for tort liability to have the effect on injurers, those injurers must be rational - 9}oKZ9K}Z}oLZ]KZ} L }o}}]o]LZ~ZZ]oo LZL[7K}Z}o22Z}]o]} ]LZ]Z}L]oo catastrophic outcomes - Common Cause of the 2 problems (=misperceived probabilities): frequency and vividness with which people are reminded of these risks (e.g. infrequentdull reminders of risk = underestimation) - With inaccuracy in making assumptions, }o L[Kl}] o o]}LZ}L benefits and costs that economic theory assumes they make - Issue between unilateral vs. bilateral precaution - LAPSES (clumsinessinattentionmisjudgmentmisperceptionweakness of will that cause accident) cause unintended negligence, which causes accident (e.g. motorists and speed limits = momentary lapses) *figure 9.1 J probability of lapse causing negligent precaution graph o Moral luck ]ZZ }o]]o]9^Z ]LooL}}Zo}EZZ]2Z]K }Z o]]o]_ role of moral luck would be reduced if rule of liability for accidents caused by negligence was replaced with one caused by INTENTIONAL negligence (DOWNFALL: required plaintiff to prove a lot more) 2. Regulation J liability vs. (safety) regulation - Regulation = ex ante enforcement by administrators (e.g. fines) - Liability = ex post enforcement by victims (courts) - Difference between administrators and courts: o Admin = technical knowledge about specialized industries (admin can set standards better than courts J e.g. safety regulations) o Courts = trials can provide better info about harm caused by accident to judgesjuries than administrators can predict o Courts = fewer political motives Regulators may set standards too low to avoid liability for politically powerful businesses (court imposed standard of care > safety regulations) o Admin = set standards too high in order to reduce competition - Safety regulations rich source of bribes for corrupt officials - Countries with admin MORE politicalcorrupt than judges, liability (adv.) > regulation - @}o]]o]-]LE[ZoZ)]LE - liability) www.notesolution.com
More Less

Related notes for ECO320H1

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit