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Liability Rules under Evidentiary Uncertainty

  • Claude Fluet

I consider the efficiency of liability rules when courts obtain imperfect information about precautionary behavior. I ask what tort rules are consistent with socially efficient precautions, what informational requirements the evidence about the parties' behavior must satisfy, what decision rules courts should apply when faced with imperfectly informative evidence, whether these decision rules can be formulated in terms of the legal concept of standard of proof, and whether some general characterization of the efficient standard can be given. I show that court judgments provide appropriate incentives to exert care if they signal that the party prevailing at trial most likely exerted due care, neither more nor less.

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Paper provided by CIRPEE in its series Cahiers de recherche with number 0606.

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Date of creation: 2006
Date of revision:
Handle: RePEc:lvl:lacicr:0606
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  1. Curran, Christopher, 1992. "The spread of the comparative negligence rule in the United States," International Review of Law and Economics, Elsevier, vol. 12(3), pages 317-332, September.
  2. Hay, Bruce L & Spier, Kathryn E, 1997. "Burdens of Proof in Civil Litigation: An Economic Perspective," The Journal of Legal Studies, University of Chicago Press, vol. 26(2), pages 413-31, June.
  3. Schauer, Frederick & Zeckhauser, Richard, 1996. "On the Degree of Confidence for Adverse Decisions," The Journal of Legal Studies, University of Chicago Press, vol. 25(1), pages 27-52, January.
  4. Paul Milgrom & John Roberts, 1986. "Relying on the Information of Interested Parties," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 18-32, Spring.
  5. Claude Fluet, 1998. "Régulation des risques et insolvabilité: le rôle de la responsabilité pour faute en information imparfaite," Cahiers de recherche du Département des sciences économiques, UQAM 9802, Université du Québec à Montréal, Département des sciences économiques.
  6. Dominique Demougin & Claude Fluet, 2002. "Preponderance of Evidence," Cahiers de recherche CREFE / CREFE Working Papers 150, CREFE, Université du Québec à Montréal.
  7. Schweizer, Urs, 2005. "Law and Economics of Obligations," International Review of Law and Economics, Elsevier, vol. 25(2), pages 209-228, June.
  8. 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-, June.
  9. Peter A. Diamond, 1974. "Single Activity Accidents," The Journal of Legal Studies, University of Chicago Press, vol. 3(1), pages 107-164, January.
  10. Claude Fluet, 2002. "Enforcing Contracts: Should Courts Seek the Truth?," Cahiers de recherche 0202, CIRPEE.
  11. Polinsky, A Mitchell & Shavell, Steven, 1989. "Legal Error, Litigation, and the Incentive to Obey the Law," Journal of Law, Economics and Organization, Oxford University Press, vol. 5(1), pages 99-108, Spring.
  12. Demougin, Dominique & Fluet, Claude, 2001. "Monitoring versus incentives," European Economic Review, Elsevier, vol. 45(9), pages 1741-1764, October.
  13. Daughety, Andrew F & Reinganum, Jennifer F, 2000. "On the Economics of Trials: Adversarial Process, Evidence, and Equilibrium Bias," Journal of Law, Economics and Organization, Oxford University Press, vol. 16(2), pages 365-94, October.
  14. Claude Fluet & Dominique Demougin, 2001. "Ranking of information systems in agency models: an integral condition," Economic Theory, Springer, vol. 17(2), pages 489-496.
  15. 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.
  16. Paul R. Milgrom, 1981. "Good News and Bad News: Representation Theorems and Applications," Bell Journal of Economics, The RAND Corporation, vol. 12(2), pages 380-391, Autumn.
  17. Aaron S. Edlin., 1993. "Efficient Standards of Due Care: Should Courts Find More Parties Negligent Under Comparative Negligence?," Economics Working Papers 93-218, University of California at Berkeley.
  18. Steven Shavell, 2003. "Economic Analysis of Accident Law," NBER Working Papers 9694, National Bureau of Economic Research, Inc.
  19. Kim, Son Ku, 1995. "Efficiency of an Information System in an Agency Model," Econometrica, Econometric Society, vol. 63(1), pages 89-102, January.
  20. Antonio Bernardo & Eric L. Talley & Ivo Welch, 1999. "A Theory of Legal Presumptions," Yale School of Management Working Papers ysm118, Yale School of Management.
  21. Daniel P. Kessler & Mark McClellan, 1996. "Do Doctors Practice Defensive Medicine?," NBER Working Papers 5466, National Bureau of Economic Research, Inc.
  22. Kolstad, Charles D & Ulen, Thomas S & Johnson, Gary V, 1990. "Ex Post Liability for Harm vs. Ex Ante Safety Regulation: Substitutes or Complements?," American Economic Review, American Economic Association, vol. 80(4), pages 888-901, September.
  23. Shavell, Steven, 2007. "Liability for Accidents," Handbook of Law and Economics, Elsevier.
  24. Kessler, Daniel & McClellan, Mark, 1996. "Do Doctors Practice Defensive Medicine?," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 353-90, May.
  25. Daniel L. Rubinfeld & David E.M. Sappington, 1987. "Efficient Awards and Standards of Proof in Judicial Proceedings," RAND Journal of Economics, The RAND Corporation, vol. 18(2), pages 308-315, Summer.
  26. Kaplow, Louis & Shavell, Steven, 1994. "Accuracy in the Determination of Liability," Journal of Law and Economics, University of Chicago Press, vol. 37(1), pages 1-15, April.
  27. Sanchirico, Chris William, 1997. "The burden of proof in civil litigation: A simple model of mechanism design," International Review of Law and Economics, Elsevier, vol. 17(3), pages 431-447, September.
  28. Hylton, Keith N, 1990. "Costly Litigation and Legal Error under Negligence," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(2), pages 433-52, Fall.
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