Duo Cum Faciunt Idem, Non Est Idem - Evidence from Austrian Pain and Suffering Verdicts
UMIT, Department of Public Health and Health Technology Assessment
Andrea M. Leiter
Faculty of Economics and Statistics, University of Innsbruck
University of Salzburg - Department of Economics and Social Sciences; Austrian Institute of Economic Research (WIFO); University of Oxford - Oxford University Centre for Business Taxation; University of Innsbruck - Department of Economics & Statistics
January 12, 2012
We analyze the pricing of pain and suffering and, in particular, whether the corresponding compensations are affected by a court’s approach to value such damages. For this purpose, we use data on pain and suffering verdicts in Austria, where courts are generally free to choose between a.per diem and a lump sum scheme to assess payments on damages for pain.and suffering. We find significant higher payments under the lump sum regime, which are not vanishing even after controlling for individual- and injury-specific characteristics. Our evidence suggests that the observed difference between lump sum and per diem schemes mainly appears if the victims are female and exposed to multiple injuries and, to a lesser extent, to intensive past pain days.
Number of Pages in PDF File: 22
Keywords: tort law, pain and suffering, per diem calculation scheme, lump sum calculation scheme
JEL Classification: K13, K41working papers series
Date posted: January 13, 2012
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