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Limiting Limited Liability

Author

Listed:
  • Giuseppe Dari-Mattiacci

    () (Amsterdam Center for Law and Economics)

Abstract

Limited liability may result in inefficient accident prevention, because a relevant portion of the expected harm is externalized on victims. This paper shows that under some restrictive conditions further limiting liability by means of a liability cap can improve caretaking.

Suggested Citation

  • Giuseppe Dari-Mattiacci, 2006. "Limiting Limited Liability," Economics Bulletin, AccessEcon, vol. 11(1), pages 1-7.
  • Handle: RePEc:ebl:ecbull:eb-06k10001
    as

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    References listed on IDEAS

    as
    1. Dari-Mattiacci, Giuseppe & De Geest, Gerrit, 2006. "When will judgment proof injurers take too much precaution?," International Review of Law and Economics, Elsevier, vol. 26(3), pages 336-354, September.
    2. T. Randolph Beard, 1990. "Bankruptcy and Care Choice," RAND Journal of Economics, The RAND Corporation, vol. 21(4), pages 626-634, Winter.
    3. Craswell, Richard & Calfee, John E, 1986. "Deterrence and Uncertain Legal Standards," Journal of Law, Economics, and Organization, Oxford University Press, vol. 2(2), pages 279-303, Fall.
    4. Mattiacci, Giuseppe Dari & Parisi, Francesco, 2003. "The cost of delegated control: vicarious liability, secondary liability and mandatory insurance," International Review of Law and Economics, Elsevier, vol. 23(4), pages 453-475, December.
    5. Boyd, James & Ingberman, Daniel E, 1994. "Noncompensatory Damages and Potential Insolvency," The Journal of Legal Studies, University of Chicago Press, vol. 23(2), pages 895-910, June.
    6. Boyd, James & Ingberman, Daniel E., 1999. "Do punitive damages promote deterrence?1," International Review of Law and Economics, Elsevier, vol. 19(1), pages 47-68, March.
    7. Giuseppe Dari-Mattiacci, 2006. "Limiting Limited Liability," Economics Bulletin, AccessEcon, vol. 11(1), pages 1-7.
    8. Shavell, S., 1986. "The judgment proof problem," International Review of Law and Economics, Elsevier, vol. 6(1), pages 45-58, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Gérard Mondello, 2017. "Lenders and Risky Activities: Strict Liability or Negligence Rule?," GREDEG Working Papers 2017-13, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.
    2. Giuseppe Dari-Mattiacci & Barbara M. Mangan, 2008. "Disappearing Defendants versus Judgment-Proof Injurers," Economica, London School of Economics and Political Science, vol. 75(300), pages 749-765, November.
    3. Gérard Mondello, 2010. "Risky Activities and Strict Liability Rules: Delegating Safety," Working Papers 2010.103, Fondazione Eni Enrico Mattei.
    4. Gérard Mondello, 2012. "Strict Liability, Capped Strict Liability, and Care Effort under Asymmetric Information," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 168(2), pages 232-251, June.
    5. Giuseppe Dari-Mattiacci, 2006. "Limiting Limited Liability," Economics Bulletin, AccessEcon, vol. 11(1), pages 1-7.

    More about this item

    JEL classification:

    • K1 - Law and Economics - - Basic Areas of Law

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