IDEAS home Printed from https://ideas.repec.org/a/ucp/jlstud/v38y2009i1p21-59.html
   My bibliography  Save this article

Negative Liability

Author

Listed:
  • Giuseppe Dari-Mattiacci

Abstract

Negative and positive externalities pose symmetrical problems to social welfare. The law internalizes negative externalities by providing general tort liability rules. According to such rules, those who cause harm to others should pay compensation. In theory, in the presence of positive externalities, negative liability should apply: those who produce benefits should be paid a compensatory award by the gainers. Nevertheless, the legal system does not display such general negative-liability rules. Rather, it tackles the problem of internalizing positive externalities by implementing a set of different and often indirect solutions. My explanation for this asymmetry in legal remedies rests on three features of a negative-liability regime, relating to intent, incentives, and evidence. These features explain the scope and design of restitution rules, liability for nonfeasance, and other mechanisms for the internalization of positive externalities. (c) 2009 by The University of Chicago. All rights reserved.

Suggested Citation

  • Giuseppe Dari-Mattiacci, 2009. "Negative Liability," The Journal of Legal Studies, University of Chicago Press, vol. 38(1), pages 21-59, January.
    • Handle: RePEc:ucp:jlstud:v:38:y:2009:i:1:p:21-59
    DOI: 10.1086/596197
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/596197
    File Function: link to full text
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/596197?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 look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cheung, Steven N S, 1973. "The Fable of the Bees: An Economic Investigation," Journal of Law and Economics, University of Chicago Press, vol. 16(1), pages 11-33, April.
    2. Alon Harel & Assaf Jacob, 2001. "An Economic Rationale for the Legal Treatment of Omissions in Tort Law," Discussion Paper Series dp281, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
    3. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    4. Craswell, Richard & Calfee, John E, 1986. "Deterrence and Uncertain Legal Standards," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 2(2), pages 279-303, Fall.
    5. Giuseppe Dari-Mattiacci, 2009. "Negative Liability," The Journal of Legal Studies, University of Chicago Press, vol. 38(1), pages 21-59, January.
    6. Wittman, Donald, 1985. "Should compensation be based on costs or benefits?," International Review of Law and Economics, Elsevier, vol. 5(2), pages 173-185, December.
    7. Elkin-Koren, Niva & Salzberger, Eli M., 2000. "Towards an economic theory of unjust enrichment law," International Review of Law and Economics, Elsevier, vol. 20(4), pages 551-573, December.
    8. Peter A. Diamond, 1974. "Single Activity Accidents," The Journal of Legal Studies, University of Chicago Press, vol. 3(1), pages 107-164, January.
    9. A. Mitchell Polinsky & Yeon-Koo Che, 1991. "Decoupling Liability: Optimal Incentives for Care and Litigation," RAND Journal of Economics, The RAND Corporation, vol. 22(4), pages 562-570, Winter.
    10. Peter A. Diamond, 1974. "Accident Law and Resource Allocation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 366-405, Autumn.
    11. Grady, Mark F, 1988. "Common Law Control of Strategic Behavior: Railroad Sparks and the Farmer," The Journal of Legal Studies, University of Chicago Press, vol. 17(1), pages 15-42, January.
    12. Bowles, Roger & Faure, Michael & Garoupa, Nuno, 2000. "Economic analysis of the removal of illegal gains," International Review of Law and Economics, Elsevier, vol. 20(4), pages 537-549, December.
    13. Goldberg, Victor P, 1994. "Recovery for Economic Loss following the Exxon Valdez Oil Spill," The Journal of Legal Studies, University of Chicago Press, vol. 23(1), pages 1-39, January.
    14. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    15. de Geest, Gerrit, 1992. "The provision of public goods in apartment buildings," International Review of Law and Economics, Elsevier, vol. 12(3), pages 299-315, September.
    16. Mishan, E J, 1971. "The Postwar Literature on Externalities: An Interpretative Essay," Journal of Economic Literature, American Economic Association, vol. 9(1), pages 1-28, March.
    17. A. Mitchell Polinsky & Steven Shavell, 1993. "Should Liability be Based on the Harm to the Victim or the Gain to the Injurer?," NBER Working Papers 4586, National Bureau of Economic Research, Inc.
    18. William M. Landes & Richard A. Posner, 1978. "Salvors, Finders, Good Samaritans and Other Rescuers: An Economic Study of Law and Altruism," NBER Working Papers 0227, National Bureau of Economic Research, Inc.
    19. Oren Bar-Gill & Omri Ben-Shahar, 2003. "The Uneasy Case for Comparative Negligence," American Law and Economics Review, American Law and Economics Association, vol. 5(2), pages 433-469, August.
    20. Donald Wittman, 1984. "Liability for Harm or Restitution for Benefit?," The Journal of Legal Studies, University of Chicago Press, vol. 13(1), pages 57-80, January.
    21. Bouckaert, Boudewijn & De Geest, Gerrit, 1995. "Private takings, private taxes, private compulsory services: The economic doctrine of quasi contracts," International Review of Law and Economics, Elsevier, vol. 15(4), pages 463-487, December.
    22. Bar-Gill Oren & Hamdani Assaf, 2003. "Optimal Liability for Libel," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 2(1), pages 1-26, June.
    23. Miceli, Thomas J., 1997. "Economics of the Law: Torts, Contracts, Property, Litigation," OUP Catalogue, Oxford University Press, number 9780195103908.
    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. Yun-chien Chang, 2015. "An economic and comparative analysis of specificatio (the accession doctrine)," European Journal of Law and Economics, Springer, vol. 39(2), pages 225-243, April.
    2. Elizabeth Hoffman & Matthew L. Spitzer, 2011. "The Enduring Power of Coase," Journal of Law and Economics, University of Chicago Press, vol. 54(S4), pages 63-76.
    3. Giuseppe Dari-Mattiacci, 2009. "Negative Liability," The Journal of Legal Studies, University of Chicago Press, vol. 38(1), pages 21-59, January.

    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. Guiseppe Dari Mattiaci & F. Parisi, 2003. "The Economics of Tort Law: A Précis," Working Papers 03-13, Utrecht School of Economics.
    2. Steven Shavell, 2005. "Liability for Accidents," NBER Working Papers 11781, National Bureau of Economic Research, Inc.
    3. Nuno Garoupa, 2009. "Least-Cost Avoidance: The Tragedy of Common Safety," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 25(1), pages 235-261, May.
    4. Giuseppe Dari‐Mattiacci & Barbara M. Mangan, 2008. "Disappearing Defendants versus Judgment‐Proof Injurers," Economica, London School of Economics and Political Science, vol. 75(300), pages 749-765, November.
    5. Emanuela Carbonara & Alice Guerra & Francesco Parisi, 2016. "Sharing Residual Liability: The Cheapest Cost Avoider Revisited," The Journal of Legal Studies, University of Chicago Press, vol. 45(1), pages 173-201.
    6. A. Mitchell Polinsky & Steven Shavell, 2005. "Economic Analysis of Law," Discussion Papers 05-005, Stanford Institute for Economic Policy Research.
    7. Donatella Porrini, 2005. "Environmental Policies Choice as an Issue of Informational Efficiency," Chapters, in: Jürgen G. Backhaus (ed.), The Elgar Companion to Law and Economics, Second Edition, chapter 23, Edward Elgar Publishing.
    8. Joshua Schwartzstein & Andrei Shleifer, 2013. "An Activity-Generating Theory of Regulation," Journal of Law and Economics, University of Chicago Press, vol. 56(1), pages 1-38.
    9. 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.
    10. Allan M. Feldman & Ram Singh, 2009. "Comparative Vigilance," American Law and Economics Review, American Law and Economics Association, vol. 11(1), pages 134-161.
    11. Gérard Mondello, 2013. "Ambiguous Beliefs on Damages and Civil Liability Theories"," Post-Print halshs-00929948, HAL.
    12. Alfred Endres & Tim Friehe, 2014. "The reasonable person standard: trading off static and dynamic efficiency," European Journal of Law and Economics, Springer, vol. 37(2), pages 249-267, April.
    13. Papiya Ghosh & Rajendra P. Kundu, 2023. "Decomposition of accident loss and decoupled liability assignment: A class of negligence rules," Indian Economic Review, Springer, vol. 58(1), pages 119-140, June.
    14. Feldman Allan M. & Singh Ram, 2011. "A Simple Guide to Comparative Vigilance," Asian Journal of Law and Economics, De Gruyter, vol. 2(3), pages 1-24, October.
    15. Bartsch, Elga, 1997. "Environmental liability, imperfect information, and multidimensional pollution control," International Review of Law and Economics, Elsevier, vol. 17(1), pages 139-146, March.
    16. Allan M Feldman & Ram Singh, 2008. "Comparative Vigilance: a Simple Guide," Working Papers 2008-11, Brown University, Department of Economics.
    17. Ram Singh, 2019. "Kaushik Basu: The republic of beliefs: A new approach to law and economics," Indian Economic Review, Springer, vol. 54(2), pages 371-380, December.
    18. Marie‐Cécile Fagart & Claude Fluet, 2009. "Liability insurance under the negligence rule," RAND Journal of Economics, RAND Corporation, vol. 40(3), pages 486-508, September.
    19. Thomas J. Miceli, 2014. "Economic Models of Law," Working papers 2014-13, University of Connecticut, Department of Economics.
    20. Helfand, Gloria E. & Berck, Peter & Maull, Tim, 2003. "The theory of pollution policy," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 1, chapter 6, pages 249-303, Elsevier.

    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:38:y:2009:i:1:p:21-59. 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.