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The Filtering Effect of Sharing Rules

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  • Giuseppe Dari-Mattiacci

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  • Gerrit de Geest

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Abstract

Sharing rules have a filtering effect on violations: they prevent the most harmful violations and let the least harmful ones occur. We show under what conditions the filtering effect improves social welfare and argue that this may explain why, in most areas of the law, sharing rules are, in general, preferred to rules that entirely burden one party. Our analysis applies to comparative negligence, communal liability, the allocation of police investigation efforts, contract remedies for non-verifiable breaches such as those that may occur in marriage and employment contracts, and to the distribution of shares in partnerships.

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Bibliographic Info

Paper provided by Utrecht School of Economics in its series Working Papers with number 04-17.

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Length: 23 pages
Date of creation: Jul 2004
Date of revision:
Handle: RePEc:use:tkiwps:0417

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Keywords: comparative negligence; law enforcement; divorce; employment contracts; theory of the firm.;

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  1. Emons, Winand, 1990. "Efficient liability rules for an economy with non-identical individuals," Journal of Public Economics, Elsevier, vol. 42(1), pages 89-104, June.
  2. P. A. Diamond, 1973. "Single Activity Accidents," Working papers 113, Massachusetts Institute of Technology (MIT), Department of Economics.
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  8. Chung, T.Y., 1992. "Efficiency of Comparative Negligence: A Game Theoretic Analysis," UWO Department of Economics Working Papers 9215, University of Western Ontario, Department of Economics.
  9. Steven Shavell, 2003. "Economic Analysis of Accident Law," NBER Working Papers 9694, National Bureau of Economic Research, Inc.
  10. Emons,Winand & Sobel,Joel, 1988. "On the effectiveness of liability rules when agents are not identical," Discussion Paper Serie A 212, University of Bonn, Germany.
  11. Aaron S. Edlin., 1993. "Efficient Standards of Due Care: Should Courts Find More Parties Negligent Under Comparative Negligence?," Economics Working Papers 93-218, University of California at Berkeley.
  12. Orr, Daniel, 1991. "The Superiority of Comparative Negligence: Another Vote," The Journal of Legal Studies, University of Chicago Press, vol. 20(1), pages 119-29, January.
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  15. Peter A. Diamond, 1974. "Accident Law and Resource Allocation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 366-405, Autumn.
  16. Shavell, Steven, 1985. "Uncertainty over Causation and the Determination of Civil Liability," Journal of Law and Economics, University of Chicago Press, vol. 28(3), pages 587-609, October.
  17. De Geest, Gerrit & Siegers, Jacques & Vandenberghe, Ann-Sophie, 2001. "The expectation measure, labor contracts, and the incentive to work hard," International Review of Law and Economics, Elsevier, vol. 21(1), pages 1-21, March.
  18. Curran, Christopher, 1992. "The spread of the comparative negligence rule in the United States," International Review of Law and Economics, Elsevier, vol. 12(3), pages 317-332, September.
  19. Lando, Henrik & Shavell, Steven, 2004. "The advantage of focusing law enforcement effort," International Review of Law and Economics, Elsevier, vol. 24(2), pages 209-218, June.
  20. Parisi, Francesco & Dari-Mattiacci, Giuseppe, 2004. "The rise and fall of communal liability in ancient law," International Review of Law and Economics, Elsevier, vol. 24(4), pages 489-505, December.
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