TORT LAW AND ECONOMICS, ENCYCLOPEDIA OF LAW AND ECONOMICS,Vol. 1, Second Edition, M.G. Faure, ed., p. 153-200, Cheltenham, UK: Edward Elgar, 2009
Rotterdam Institute of Law and Economics (RILE) Working Paper Series No. 2008/02
48 Pages Posted: 19 Mar 2008 Last revised: 2 May 2013
Date Written: August 31, 2010
In this Chapter, I provide an overview of Law and Economics literature regarding tort damages. Where necessary, attention is also spent to rules of tort liability. Both types of rules provide behavioral incentives to both injurers and victims, with respect to their level of care and activity. Moreover, they determine who is the residual risk bearer. Many topics determine who ultimately bears which risks, among which the applicable liability rule (strict liability or negligence), the question which losses are included in the damages and which are excluded, the issue whether punitive damages are possible, how future losses, damages for nonpecuniary losses and fatal accidents are calculated, and how the topic of multiple tortfeasors is dealt with. Finally, empirical research regarding tort damages is briefly touched upon. The Chapter is followed by an extensive bibliography.
Keywords: Computation of Damages, Future Losses, Judgment Proof, Limitation of Damages, Loss of a Chance, Mitigation of Losses, Non Pecuniary Losses, Pain and Suffering, Punitive Damages, Pure Economic Loss, Tort Damages, Uncompensated Losses, Value of Human Life, Quality Adjusted Life Years
JEL Classification: K13
Suggested Citation: Suggested Citation