Abstract

http://ssrn.com/abstract=2189090
 


 



Assessing the Insurance Role of Tort Liability after Calabresi


W. Kip Viscusi


Vanderbilt University - Law School; National Bureau of Economic Research (NBER); Vanderbilt University - Department of Economics; Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - Strategy and Business Economics

Joni Hersch


Vanderbilt University - Law School; Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - College of Arts and Science - Department of Economics

June 27, 2013

Vanderbilt Law and Economics Research Paper No. 12-35

Abstract:     
Calabresi’s theory of tort liability (1961) as a risk distribution mechanism established insurance as an objective of tort liability. Calabresi’s risk-spreading concept of tort has provided the impetus for much of the subsequent development of tort liability doctrine, including risk-utility analysis and strict liability. Calabresi’s analysis remains a powerful basis for modern tort liability. However, high transactions costs, correlated risks, catastrophic losses, mass toxic torts, shifts in liability rules over time, noneconomic damages, and punitive damages affect the functioning of tort liability as an insurance mechanism. Despite some limitations of tort liability as insurance, tort compensation serves both a compensatory and deterrence role. Tort liability retains a valuable risk-spreading function in many situations and may be superior to alternative institutional mechanisms in fostering incentives.

Number of Pages in PDF File: 44

Keywords: tort liability, torts, damages, insurance, Calabresi

JEL Classification: K13, K0, I13

working papers series


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Date posted: December 14, 2012 ; Last revised: July 1, 2013

Suggested Citation

Viscusi, W. Kip and Hersch, Joni, Assessing the Insurance Role of Tort Liability after Calabresi (June 27, 2013). Vanderbilt Law and Economics Research Paper No. 12-35. Available at SSRN: http://ssrn.com/abstract=2189090 or http://dx.doi.org/10.2139/ssrn.2189090

Contact Information

W. Kip Viscusi (Contact Author)
Vanderbilt University - Law School ( email )
131 21st Avenue South
Nashville, TN 37203-1181
United States
615-343-7715 (Phone)
615-322-5953 (Fax)
HOME PAGE: http://law.vanderbilt.edu/faculty/viscusi.htm
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Vanderbilt University - Department of Economics
Box 1819 Station B
Nashville, TN 37235
United States
(615) 343-7715 (Phone)
(615) 343-5953 (Fax)
HOME PAGE: http://law.vanderbilt.edu/faculty/viscusi.htm
Vanderbilt University - Owen Graduate School of Management
401 21st Avenue South
Nashville, TN 37203
United States
(615) 343-7715 (Phone)
(615) 343-5953 (Fax)
HOME PAGE: http://law.vanderbilt.edu/faculty/viscusi.htm
Vanderbilt University - Strategy and Business Economics ( email )
Nashville, TN 37203
United States

Joni Hersch
Vanderbilt University - Law School ( email )
131 21st Avenue South
Nashville, TN 37203-1181
United States
615-343-7717 (Phone)
615-322-6631 (Fax)
HOME PAGE: http://law.vanderbilt.edu/go/phdlawecon
Vanderbilt University - Owen Graduate School of Management
401 21st Avenue South
Nashville, TN 37203
United States
Vanderbilt University - College of Arts and Science - Department of Economics
Box 1819 Station B
Nashville, TN 37235
United States
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