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Calculating Compensation in Cases of Wrongful Death

Author

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  • Arthur Lewbel

    (Boston College)

Abstract

Death statutes in the United States list elements of loss for which a defendant must make compensatory payment. The element that economists as expert witnesses are called upon to calculate is net income, roughly defined as the decedent's income minus personal expenses. The existence of joint or shared consumption goods complicates the definition and calculation of net income. Net income can be interpreted as the money required for survivors to attain the same standard of living as before. Equivalence scales traditionally used for this type of calculation are flawed. A new method for calculating net income is proposed, based on a collective household model.

Suggested Citation

  • Arthur Lewbel, 2002. "Calculating Compensation in Cases of Wrongful Death," Boston College Working Papers in Economics 523, Boston College Department of Economics, revised 07 Jun 2002.
    • Handle: RePEc:boc:bocoec:523
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    References listed on IDEAS

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