The reasonable person standard: trading off static and dynamic efficiency
AbstractThis 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
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Bibliographic InfoArticle provided by Springer in its journal European Journal of Law and Economics.
Volume (Year): 37 (2014)
Issue (Month): 2 (April)
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Web page: http://www.springerlink.com/link.asp?id=100264
Endogenous care technology; Due care standards; Reasonable person; Liability law; K13;
Find related papers by JEL classification:
- K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics
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