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The reasonable person standard: trading off static and dynamic efficiency

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  • Alfred Endres
  • Tim Friehe

Abstract

This paper compares the performance of a due care standard which is tailored to individual precaution costs to that of the reasonable person standard. This is done in a framework in which injurers can reduce their precaution costs via investment in progressing care technology. We show that the reasonable person standard may invoke better investment incentives, pointing to a potential trade-off between static and dynamic efficiency. Copyright Springer Science+Business Media, LLC 2014

Suggested Citation

  • Alfred Endres & Tim Friehe, 2014. "The reasonable person standard: trading off static and dynamic efficiency," European Journal of Law and Economics, Springer, vol. 37(2), pages 249-267, April.
    • Handle: RePEc:kap:ejlwec:v:37:y:2014:i:2:p:249-267
    DOI: 10.1007/s10657-011-9283-2
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    More about this item

    Keywords

    Endogenous care technology; Due care standards; Reasonable person; Liability law; K13;
    All these keywords.

    JEL classification:

    • K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics

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