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Legal Liability when Individuals Have Moral Concerns


  • Bruno Deffains
  • Claude Fluet


We incorporate normative motivations into the economic model of accidents and tort rules. The social norm is that one should avoid harming others and should compensate if nevertheless harm is caused. To some extent, this is internalized through intrinsic moral concerns; moreover, those thought not to adhere to the norm are met with social disapproval. Moral and reputational concerns are not strong enough, however, for injurers to willingly compensate their victims. Absent legal liability, normative concerns induce precautions to prevent harm but precautions are then socially inefficient. By contrast, perfectly enforced legal liability crowds out informal incentives completely (e.g., individuals causing harm suffer no stigma) but precautions are then socially efficient. Under imperfectly enforced legal liability, formal legal sanctions and normative concerns are complements and interact to induce more precautions than under no-liability.

Suggested Citation

  • Bruno Deffains & Claude Fluet, 2009. "Legal Liability when Individuals Have Moral Concerns," Cahiers de recherche 0951, CIRPEE.
  • Handle: RePEc:lvl:lacicr:0951

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    References listed on IDEAS

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    Cited by:

    1. Roland Benabou & Jean Tirole, 2011. "Laws and Norms," NBER Working Papers 17579, National Bureau of Economic Research, Inc.
    2. Fluet, Claude & Galbiati, Rpbertp, 2016. "Lois et normes : les enseignements de l'économie comportementale," L'Actualité Economique, Société Canadienne de Science Economique, vol. 92(1-2), pages 191-215, Mars-Juin.
    3. Claude-Denys Fluet & Romain Espinosa & Bruno Deffains, 2017. "Laws and Norms: Experimental Evidence with Liability Rules," Cahiers de recherche 1705, Centre de recherche sur les risques, les enjeux économiques, et les politiques publiques.
    4. Claude-Denys Fluet & Murat C. Mungan, 2017. "The Signal-Tuning Function of Liability Regimes," Cahiers de recherche 1707, Centre de recherche sur les risques, les enjeux économiques, et les politiques publiques.
    5. Bruno Deffains & Claude Fluet, 2015. "Social Norms and Legal Design," CIRANO Working Papers 2015s-44, CIRANO.

    More about this item


    Intrinsic motivations; social norms; esteem; strict liability; negligence; crowding out;

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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