IDEAS home Printed from https://ideas.repec.org/a/bpj/rlecon/v5y2009i1n16.html
   My bibliography  Save this article

The Structure of Incremental Liability Rules

Author

Listed:
  • Jain Satish K.

    (Jawaharlal Nehru University)

Abstract

This paper investigates the structure of incremental liability rules. Necessary and sufficient conditions are derived for an incremental liability rule to be efficient. A liability rule, in the ordinary sense of the term, to be called a standard liability rule, is a rule which specifies the proportions in which the loss, in case of accident, is to be apportioned between the victim and the injurer as a function of their proportions of non-negligence. An incremental liability rule is a rule which specifies (i) which of the two parties, the victim or the injurer, is to be the non-residual liability holder; and (ii) the proportion of the incremental loss, which can be ascribed to the negligence of the non-residual party, to be borne by the non-residual liability holder. The necessary and sufficient conditions for an incremental liability rule to be efficient, derived in the paper, can be stated as follows: Let the party which is the residual liability holder when both parties are non-negligent be designated as r and the other party as nr. An incremental liability rule is efficient for every admissible application iff its structure is such that: (i) If party r is negligent and party nr is non-negligent, then party r must remain the residual liability holder. (ii) If party nr is negligent and party r is non-negligent, then party nr must either become the residual liability holder or liability of nr must be equal to the entire incremental loss which can be ascribed to the negligence of nr.

Suggested Citation

  • Jain Satish K., 2009. "The Structure of Incremental Liability Rules," Review of Law & Economics, De Gruyter, vol. 5(1), pages 373-398, June.
  • Handle: RePEc:bpj:rlecon:v:5:y:2009:i:1:n:16
    DOI: 10.2202/1555-5879.1209
    as

    Download full text from publisher

    File URL: https://doi.org/10.2202/1555-5879.1209
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

    File URL: https://libkey.io/10.2202/1555-5879.1209?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Satish K. Jain & Ram Singh, 2002. "Efficient Liability Rules: Complete Characterization," Journal of Economics, Springer, vol. 75(2), pages 105-124, March.
    2. Kahan, Marcel, 1989. "Causation and Incentives to Take Care under the Negligence Rule," The Journal of Legal Studies, University of Chicago Press, vol. 18(2), pages 427-447, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dari-Mattiacci Giuseppe & Hendriks Eva S., 2013. "Relative Fault and Efficient Negligence: Comparative Negligence Explained," Review of Law & Economics, De Gruyter, vol. 9(1), pages 1-40, June.
    2. Jain, Satish, 2010. "Market, Democracy, and Diversity of Individual Preferences," Working Papers 7, JICA Research Institute.
    3. Kundu, Rajendra P. & Kaur, Harshil, 2022. "Efficient simple liability assignment rules: A complete characterization," Mathematical Social Sciences, Elsevier, vol. 116(C), pages 22-31.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Singh, Ram, 2007. "‘Causation-consistent’ liability, economic efficiency and the law of torts," International Review of Law and Economics, Elsevier, vol. 27(2), pages 179-203.
    2. Allan M. Feldman & Ram Singh, 2009. "Comparative Vigilance," American Law and Economics Review, American Law and Economics Association, vol. 11(1), pages 134-161.
    3. Ram Singh, 2002. "Causation, Economic Efficiency and the Law of Torts," Working papers 102, Centre for Development Economics, Delhi School of Economics.
    4. Satish Jain, 2006. "Efficiency of liability rules: A reconsideration," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 15(3), pages 359-373.
    5. Allan M Feldman & Ram Singh, 2008. "Comparative Vigilance: a Simple Guide," Working Papers 2008-11, Brown University, Department of Economics.
    6. Ram Singh, 2006. "On the Existence and Efficiency of Equilibria under Liability Rules," Working papers 150, Centre for Development Economics, Delhi School of Economics.
    7. Allan M. Feldman & Ram Singh, 2009. "Comparative Vigilance," American Law and Economics Review, Oxford University Press, vol. 11(1), pages 134-161.
    8. FRANCESCO PARISI & Ram Singh, 2009. "Efficiency Of Equilibria Under Comparative Causation," Working papers 179, Centre for Development Economics, Delhi School of Economics.
    9. Ram Singh, 2005. "Comparative Causation -- A Re-examination," Working papers 139, Centre for Development Economics, Delhi School of Economics.
    10. Ram Singh, 2001. "Efficient Liability Rules When Courts Make Errors in Estimation of the Harm : Complete Characterization," Working papers 99, Centre for Development Economics, Delhi School of Economics.
    11. Parisi Francesco & Singh Ram, 2010. "The Efficiency of Comparative Causation," Review of Law & Economics, De Gruyter, vol. 6(2), pages 219-245, September.
    12. Kundu, Rajendra P. & Kaur, Harshil, 2022. "Efficient simple liability assignment rules: A complete characterization," Mathematical Social Sciences, Elsevier, vol. 116(C), pages 22-31.
    13. Ram Singh, 2016. "‘Full’ Compensation Criteria in the Law of Torts: An Enquiry into the Doctrine of Causation," Working Papers id:11237, eSocialSciences.
    14. Schweizer, Urs, 2005. "Law and Economics of Obligations," International Review of Law and Economics, Elsevier, vol. 25(2), pages 209-228, June.
    15. Schweizer, Urs, 2004. "Law and Economics of Obligations," Bonn Econ Discussion Papers 2/2004, University of Bonn, Bonn Graduate School of Economics (BGSE).
    16. Lars Klöhn, 2011. "Unmanifested Harm in Business-to-Consumer Transactions," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 167(1), pages 94-97, March.
    17. Jain, Satish K. & Kundu, Rajendra P., 2006. "Characterization of efficient simple liability rules with multiple tortfeasors," International Review of Law and Economics, Elsevier, vol. 26(3), pages 410-427, September.
    18. Friehe, Tim & Langlais, Eric, 2017. "Prevention and cleanup of dynamic harm under environmental liability," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 107-120.
    19. Rajendra P. Kundu, 2009. "Efficiency Of Liability Rules With Interdependent Costs Of Care," Pacific Economic Review, Wiley Blackwell, vol. 14(1), pages 71-88, February.
    20. Tim Friehe, 2014. "Tacit collusion and liability rules," European Journal of Law and Economics, Springer, vol. 38(3), pages 453-469, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:rlecon:v:5:y:2009:i:1:n:16. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.