Medical Malpractice and Physician Liability Under a Negligence Rule

Donald Wright

No 2011-04, Working Papers from University of Sydney, School of Economics

Abstract: A model of costly medical malpractice claims, based on Bayes Rule, is developed to examine the effects of physicians being liable for actual damage under a negligence rule. This model is consistent with empirical evidence concerning the pattern of claims. It is shown that compensating actual damage does not provide physicians with appropriate incentives to spend the second best optimal amount of time with patients or to treat the second best optimal number of patients. As a result, too much medical malpractice occurs relative to the second best social optimum.

Keywords: Medical Malpractice; Liability (search for similar items in EconPapers)
Date: 2011-03
New Economics Papers: this item is included in nep-hea
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Citations: View citations in EconPapers (3)

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http://hdl.handle.net/2123/7705

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Journal Article: Medical malpractice and physician liability under a negligence rule (2011)
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