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When is the Preponderance of the Evidence Standard Optimal?

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  • Henrik Lando

    (Copenhagen Business School)

Abstract

This paper defines the preponderance of the evidence standard and establishes it as a benchmark, optimal under certain idealized conditions. The main conditions are: only efficiency matters (not fairness); people are risk–neutral; sanctions are socially cost–free; and a suit may be brought even if no violation of the law has occurred. Concerning the definition of preponderance of the evidence, a distinction is made between standards based on probability of guilt and standards based on the evidence. It is stressed that the latter does not include ex ante information concerning the offender’s type, and should hence not be associated with a probability of guilt in a Bayesian sense. The Geneva Papers on Risk and Insurance (2002) 27, 602–608. doi:10.1111/1468-0440.00195

Suggested Citation

  • Henrik Lando, 2002. "When is the Preponderance of the Evidence Standard Optimal?," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 27(4), pages 602-608, October.
    • Handle: RePEc:pal:gpprii:v:27:y:2002:i:4:p:602-608
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    Citations

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    Cited by:

    1. Dominique Demougin & Claude Fluet, 2008. "Rules of proof, courts, and incentives," RAND Journal of Economics, RAND Corporation, vol. 39(1), pages 20-40, March.
    2. Lando, Henrik & Mungan, Murat C., 2018. "The effect of type-1 error on deterrence," International Review of Law and Economics, Elsevier, vol. 53(C), pages 1-8.
    3. Louis Kaplow, 2011. "On the Optimal Burden of Proof," Journal of Political Economy, University of Chicago Press, vol. 119(6), pages 1104-1140.
    4. Louis Kaplow, 2011. "Optimal Proof Burdens, Deterrence, and the Chilling of Desirable Behavior," American Economic Review, American Economic Association, vol. 101(3), pages 277-280, May.
    5. Louis Kaplow, 2017. "Optimal Multistage Adjudication," NBER Working Papers 23364, National Bureau of Economic Research, Inc.
    6. Edwige Fain, 2017. "Standard of proof and volume of litigation: A comparative perspective," Economics Bulletin, AccessEcon, vol. 37(4), pages 2434-2445.
    7. Louis Kaplow, 2012. "On the Optimal Burden of Proof," NBER Working Papers 17765, National Bureau of Economic Research, Inc.
    8. Lucia Dalla Pellegrina & Giorgio Di Maio & Donato Masciandaro & Margherita Saraceno, 2020. "Are Bankers "Crying Wolf"? The Risk-Based Approach to Money-Laundering Regulation and its Effects," Working Papers 444, University of Milano-Bicocca, Department of Economics, revised Feb 2021.
    9. Dominique Demougin & Claude Fluet, 2005. "Deterrence versus Judicial Error: A Comparative View of Standards of Proof," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 161(2), pages 193-206, June.
    10. Shmuel Leshem & Geoffrey P. Miller, 2009. "All-or-Nothing versus Proportionate Damages," The Journal of Legal Studies, University of Chicago Press, vol. 38(2), pages 345-382, June.
    11. Louis Kaplow, 2017. "Optimal Multistage Adjudication," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 33(4), pages 613-652.
    12. Matteo Rizzolli, 2016. "Adjudication: Type-I and Type-II Errors," CERBE Working Papers wpC15, CERBE Center for Relationship Banking and Economics.
    13. Drugov, Mikhail & Troya Martinez, Marta, 2012. "Vague Lies: How to Advise Consumers When They Complain," CEPR Discussion Papers 9201, C.E.P.R. Discussion Papers.

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