Nash Implementable Liability Rules for Judgement-Proof Injurers

Patrick Gonzalez (pgon@ecn.ulaval.ca)

Cahiers de recherche from Université Laval - Département d'économique

Abstract:

I provide a complete characterization of Nash implementable allocations of spending in prevention by judgement-proof injurers. This characterization is used to identify the optimal rule that allows for the maximum total spending in prevention. The optimal rule amounts to apply the negligence rule to the "deep-pocket" (or the "victim"), that is the injurer who responds the most to monetary incentives under the strict liability rule, and the strict liability rule to everybody else.

Keywords: Negligence rule; limited liability; multiple injurers; Nash implementation (search for similar items in EconPapers)
JEL-codes: D78 H23 K13 (search for similar items in EconPapers)
Date: 2004
New Economics Papers: this item is included in nep-law
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http://www.ecn.ulaval.ca/w3/recherche/cahiers/2004/0403.pdf (application/pdf)

Related works:
Working Paper: Nash Implementable Liability Rules for Judgement-Proof Injurers (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:lvl:laeccr:0403

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