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A Deterrence Perspective on Damages for Fraudulent Misrepresentation

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  • Qi Zhou

    (The School of Law, The University of Manchester. Williamson Building, Oxford Road Manchester, M13 9PL. Email: zhou@qizhou.net)

Abstract

The purposes of this paper are twofold. First, it provides a theoretical framework for understanding the deterrence function of damages as a private legal remedy for fraudulent misrepresentation, explains, from an economic perspective, why fraudulent misrepresentation is socially undesirable, and then shows how the damages rule can be used as a deterrence instrument. Second, it conducts a brief analysis of the deterrence of fraudulent misrepresentation in English tort law and argues that, despite some imperfections, damages in tort law can provide a valuable complement to some traditional deterrence sanctions to fraud such as criminal law and regulation.

Suggested Citation

  • Qi Zhou, 2007. "A Deterrence Perspective on Damages for Fraudulent Misrepresentation," Journal of Interdisciplinary Economics, , vol. 19(1), pages 83-96, October.
  • Handle: RePEc:sae:jinter:v:19:y:2007:i:1:p:83-96
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