Negative Liability

Giuseppe Dari-Mattiacci

The Journal of Legal Studies, 2009, vol. 38, issue 1, 21-59

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.

Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://dx.doi.org/10.1086/596197 link to full text (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
Working Paper: Negative Liability
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:v:38:y:2009:i:1:p:21-59

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 ().