Innovation, information, lobby and tort law under uncertainty

Julien Jacob and Caroline Orset ()

Working Papers of BETA from Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg

Abstract: Recent environmental policies favour the ’pollutant-payer’ Principle. This principle points out the pollutant financial liability for potential incidents induced by its activities. Investing in technological innovations generates uncertainty on the future returns, as well as on the damages that such innovations could involve and on the cost to reimburse in the event that of troubles. To reduce this uncertainty, the firm has the opportunity to acquire information, for example through research activities, on its project’s potential consequences on human health and the environment. Nevertheless, in their efforts to achieve and/or to maintain a marketing authorisation with the agency, firms may develop specific strategies to exploit scientific uncertainty. They may produce favourable scientific findings. In case of accident, the firm utilising this type of behaviour can be legally charged. We then analyse whether liability rules and tort law incentive the firm both to invest in research and development to reduce the uncertainty and to decrease miscommunication on the results.

Keywords: health and environmental risks; industrial risks; information acquisition; innovation; liability rules; lobby. (search for similar items in EconPapers)
JEL-codes: D01 D72 K32 Q57 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-env, nep-ino, nep-law and nep-ore
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Related works:
Working Paper: Innovation, information, lobby and tort law under uncertainty (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:ulp:sbbeta:2020-25

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