Tort Reform and Accidental Deaths
Theory suggests that tort reform could have two possible impacts on accidents. Reforms could increase accidents as tortfeasors internalize less of the cost of externalities and have less incentive to reduce the risk of accidents. Alternatively, tort reforms could decrease accidents as lower expected liability costs result in lower prices, enabling consumers to buy more risk-reducing products such as medicines, safety equipment, and medical services, and could result in consumers increasing precautions to avoid accidents. We test these effects by examining the relationship between tort reform and non-motor-vehicle accidental death rates using panel data techniques. We find that noneconomic damage caps, a higher evidence standard for punitive damages, product liability reform, and prejudgment interest reform are associated with fewer accidental deaths, while reforms to the collateral source rule are associated with increased deaths. Overall, the tort reforms in the states between 1981 and 2000 are associated with an estimated 24,000 fewer accidental deaths.
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- Calfee, John E & Rubin, Paul H, 1992. "Some Implications of Damage Payments for Nonpecuniary Losses," The Journal of Legal Studies, University of Chicago Press, vol. 21(2), pages 371-411, June.
- George L. Priest, 1991. "The Modern Expansion of Tort Liability: Its Sources, Its Effects, and Its Reform," Journal of Economic Perspectives, American Economic Association, vol. 5(3), pages 31-50, Summer.
- Browne, Mark J & Puelz, Robert, 1999. "The Effect of Legal Rules on the Value of Economic and Non-economic Damages and the Decision to File," Journal of Risk and Uncertainty, Springer, vol. 18(2), pages 189-213, August.
- Alma Cohen & Rajeev Dehejia, 2003.
"The Effect of Automobile Insurance and Accident Liability Laws in Traffic Fatalities,"
NBER Working Papers
9602, National Bureau of Economic Research, Inc.
- Cohen, Alma & Dehejia, Rajeev, 2004. "The Effect of Automobile Insurance and Accident Liability Laws on Traffic Fatalities," Journal of Law and Economics, University of Chicago Press, vol. 47(2), pages 357-93, October.
- Viscusi, W. Kip & Zeckhauser, Richard J. & Born, Patricia & Blackmon, Glenn, 1993. "The Effect of 1980s Tort Reform Legislation on General Liability and Medical Malpractice Insurance," Journal of Risk and Uncertainty, Springer, vol. 6(2), pages 165-86, April.
- Manning, Richard L, 1994. "Changing Rules in Tort Law and the Market for Childhood Vaccines," Journal of Law and Economics, University of Chicago Press, vol. 37(1), pages 247-75, April.
- W. Kip Viscusi & Patricia H. Born, 2005. "Damages Caps, Insurability, and the Performance of Medical Malpractice Insurance," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 72(1), pages 23-43.
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