On the joint use of licensing and liability

Erik Lenntorp

International Review of Law and Economics, 2009, vol. 29, issue 3, 244-251

Abstract: Licensing is a widely used technique applied to impose regulations. Firms inducing harm must hold a license issued by a regulatory agency on a case-by-case basis. A firm may also be subject to liability. This paper studies the implications on social welfare of combining licensing with strict liability. Contributions include the study of a joint use and related administrative costs. The latter include costs pertaining to litigation and the issuing and enforcing of licenses. It is established when a joint use is motivated. Regulatory compliance should protect from liability in order to decrease litigation and enforcement costs and associated distortions.

Keywords: Enforcement; Joint; use; Liability; Licensing; Regulation (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:irlaec:v:29:y:2009:i:3:p:244-251

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