Commodifying Liability

Robert Cooter

Berkeley Program in Law and Economics, Working Paper Series from Berkeley Program in Law and Economics

Abstract: In recent years, ingenious entrepreneurs have invented new commodities by bundling contingent claims and marketing them. A liability right can be viewed as a contingent claim and analyzed like stock options or commodity futures. Since law prohibits markets for liability rights, no one knows how they would work. I assume no legal impediments to unbundling, packaging, and selling liability rights. I then predict how a competitive market would price liability rights. I use such an ideal market to critique the actual system of tort liability. Competition can solve many of the problems attributed by courts to contracts that reallocate tort liability.

Date: 1997-09-29
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.escholarship.org/uc/item/9pq4m8ts.pdf;origin=repeccitec (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cdl:oplwec:qt9pq4m8ts

Access Statistics for this paper

More papers in Berkeley Program in Law and Economics, Working Paper Series from Berkeley Program in Law and Economics Contact information at EDIRC.
Bibliographic data for series maintained by eScholarship, California Digital Library ().