Negligence, Strict Liability, and Collective Action

David Gilo, Ehud Guttel and Erez Yuval

The Journal of Legal Studies, 2013, vol. 42, issue 1, 69 - 82

Abstract: An injurer's activity often exposes multiple potential victims to the risk of harm. We show that under negligence--the tort system's dominant regime--such victims face a collective-action problem in choosing their activity levels. An increase in one victim's activity level confers a positive externality on the other victims because it requires the injurer to take more care. Victims will accordingly choose lower activity levels than they would choose if they acted collectively. Interestingly, depending on the efficiency of the injurer's precautions, victims' failure to coordinate can either increase or decrease social welfare. We discuss the implications of our analysis for nuisance disputes, the desirability of reimbursement rules, and the efficiency of insurance.

Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.1086/669191 (application/pdf)
http://dx.doi.org/10.1086/669191 (text/html)
Access to the online full text or PDF requires a subscription.

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:ucp:jlstud:doi:10.1086/669191

Access Statistics for this article

More articles in The Journal of Legal Studies from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().