IDEAS home Printed from https://ideas.repec.org/a/ucp/jlstud/v37y2008i2p339-378.html
   My bibliography  Save this article

Transnational Forum Shopping as a Trade and Investment Issue

Author

Listed:
  • Alan O. Sykes

Abstract

Plaintiffs regularly bring cases in U.S. courts seeking damages for harms that have occurred abroad, attracted by higher expected returns than are available in the jurisdiction in which the harm arose. This paper focuses on the potential distortion of trade and investment patterns that can result from implicit discrimination in the applicability of liability rules to producers or investors of different nationalities due to such forum shopping. These distortions are akin to those caused by discriminatory tariff or tax policies and can reduce global economic welfare. In appropriate cases, the welfare costs can be averted by limiting foreign tort plaintiffs to the law and forum of the jurisdiction in which their harm arose, although such a rule is not efficient in all cases. The analysis has implications for a number of areas of legal doctrine, including the doctrine of forum non conveniens, the construction of the Alien Tort Statute, and the rules governing choice of law in transnational tort cases. (c) 2008 by The University of Chicago. All rights reserved.

Suggested Citation

  • Alan O. Sykes, 2008. "Transnational Forum Shopping as a Trade and Investment Issue," The Journal of Legal Studies, University of Chicago Press, vol. 37(2), pages 339-378, June.
    • Handle: RePEc:ucp:jlstud:v:37:y:2008:i:2:p:339-378
    DOI: 10.1086/589664
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/589664
    File Function: link to full text
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/589664?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. Michelle J. White, 2006. "Asbestos Litigation: Procedural Innovations and Forum Shopping," The Journal of Legal Studies, University of Chicago Press, vol. 35(2), pages 365-398, June.
    2. A. Mitchell Polinsky & William P. Rogerson, 1983. "Products Liability, Consumer Misperceptions, and Market Power," Bell Journal of Economics, The RAND Corporation, vol. 14(2), pages 581-589, Autumn.
    3. Harold Koh, 2004. "Separating Myth From Reality About Corporate Responsibility Litigation," Journal of International Economic Law, Oxford University Press, vol. 7(2), pages 263-274, June.
    4. Harry G. Johnson, 1953. "Optimum Tariffs and Retaliation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 21(2), pages 142-153.
    5. A. Mitchell Polinsky, 1980. "Strict Liability versus Negligence in a Market Setting," NBER Working Papers 0420, National Bureau of Economic Research, Inc.
    6. Epstein, Richard A & Sykes, Alan O, 2001. "The Assault on Managed Care: Vicarious Liability, ERISA Preemption, and Class Actions," The Journal of Legal Studies, University of Chicago Press, vol. 30(2), pages 625-659, June.
    7. Roberta Romano, 1998. "Empowering Investors: A Market Approach to Securities Regulation," Yale School of Management Working Papers ysm74, Yale School of Management.
    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. Baumann, Florian, 2015. "Freier Warenverkehr und unverfälschter Wettbewerb in der Europäischen Union: Der Beitrag der europäischen Produkthaftung," DICE Ordnungspolitische Perspektiven 75, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    2. Paul B. Stephan, 2013. "The Political Economy of Extraterritoriality," Politics and Governance, Cogitatio Press, vol. 1(1), pages 92-101.
    3. Christopher A. Whytock, 2022. "Transnational Litigation in U.S. Courts: A Theoretical and Empirical Reassessment," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 19(1), pages 4-59, March.
    4. Patrick Bayer & Christopher Marcoux & Johannes Urpelainen, 2014. "Choosing international organizations: When do states and the World Bank collaborate on environmental projects?," The Review of International Organizations, Springer, vol. 9(4), pages 413-440, December.

    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. Ram Singh, 2009. "RISK, INFORMATIONAL ASYMMETRY AND PRODUCT LIABILITY: An Enquiry Into Conflicting Objectives," Pacific Economic Review, Wiley Blackwell, vol. 14(1), pages 89-112, February.
    2. Andrew F. Daughety & Jennifer F. Reinganum, 2006. "Markets, torts, and social inefficiency," RAND Journal of Economics, RAND Corporation, vol. 37(2), pages 300-323, June.
    3. Tim Friehe & Cat Lam Pham & Thomas J. Miceli, 2022. "Product Liability and Strategic Delegation: Endogenous Manager Incentives Promote Strict Liability," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 61(2), pages 149-169, September.
    4. Andrzej Baniak & Peter Grajzl, 2017. "Optimal Liability when Consumers Mispredict Product Usage," American Law and Economics Review, American Law and Economics Association, vol. 19(1), pages 202-243.
    5. Pravin Krishna & Devashish Mitra, 2016. "Reciprocated unilateralism in trade policy," World Scientific Book Chapters, in: The Political Economy of Trade Policy Theory, Evidence and Applications, chapter 3, pages 37-63, World Scientific Publishing Co. Pte. Ltd..
    6. Miceli Thomas J. & Segerson Kathleen, 2013. "Liability versus Regulation for Dangerous Products When Consumers Vary in Their Susceptibility to Harm and May Misperceive Risk," Review of Law & Economics, De Gruyter, vol. 9(3), pages 341-355, December.
    7. Lusk Jayson L. & Marette Stéphan, 2012. "Can Labeling and Information Policies Harm Consumers?," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 10(1), pages 1-15, October.
    8. Götz, Christian & Heckelei, Thomas & Rudloff, Bettina, 2010. "What makes countries initiate WTO disputes on food-related issues?," Food Policy, Elsevier, vol. 35(2), pages 154-162, April.
    9. Becht, Marco & Mayer, Colin & Wagner, Hannes F., 2008. "Where do firms incorporate? Deregulation and the cost of entry," Journal of Corporate Finance, Elsevier, vol. 14(3), pages 241-256, June.
    10. Bouet, Antoine & Laborde, David, 2008. "The potential cost of a failed Doha Round," Issue briefs 56, International Food Policy Research Institute (IFPRI).
    11. Breuer, Matthias, 2017. "How Does Financial-Reporting Regulation Affect Market-Wide Resource Allocation?," Working Papers 270, The University of Chicago Booth School of Business, George J. Stigler Center for the Study of the Economy and the State.
    12. Rod Tyers & Yixiao Zhou, 2020. "US–China rivalry: The macro policy choices," The World Economy, Wiley Blackwell, vol. 43(9), pages 2286-2314, September.
    13. Felbermayr, Gabriel, 2022. "European trade policy at the service of geopolitics? Requirements for new instruments from the perspective of family businesses," Studien, Stiftung Familienunternehmen / Foundation for Family Businesses, number 273454.
    14. Naqvi, Nadeem, 2010. "A theory of dynamic tariff and quota retaliation," MPRA Paper 27656, University Library of Munich, Germany.
    15. Tomas J. Philipson & Eric Sun, 2008. "Is the Food And Drug Administration Safe And Effective?," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 85-102, Winter.
    16. Guttentag Michael, 2007. "Accuracy Enhancement, Agency Costs, and Disclosure Regulation," Review of Law & Economics, De Gruyter, vol. 3(2), pages 611-641, December.
    17. Kishore Gawande, 1997. "A Test of a Theory of Strategically Retaliatory Trade Barriers," Southern Economic Journal, John Wiley & Sons, vol. 64(2), pages 425-449, October.
    18. Jonathan Heathcote & Fabrizio Perri, 2016. "On the Desirability of Capital Controls," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 64(1), pages 75-102, May.
    19. Jeong-Yoo Kim, 2024. "Law and Economics of Artificial Intelligence: Optimal Liability Rules for Accident Losses Caused by Fully Autonomous Vehicles," Korean Economic Review, Korean Economic Association, vol. 40, pages 49-75.
    20. Hideo Konishi & Carsten Kowalczyk & Tomas Sjostrom, 2003. "Free Trade, Customs Unions, and Transfers," Boston College Working Papers in Economics 568, Boston College Department of Economics.

    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:ucp:jlstud:v:37:y:2008:i:2:p:339-378. 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: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JLS .

    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.