HOW TO SHARE JOINT LIABILITY: A COOPERATIVE GAME APPROACH
18 Pages Posted: 23 Jan 2012
Date Written: January 23, 2012
Abstract
Sharing a damage that has been caused by several individuals is a difficult problem that courts often face. Even if there exist basic principles and rules to apportion damages among them (like for instance in the third Restatement of Torts promulgated in May 1999), legal scholars are still looking for a systematic method. We analyze these issues from a cooperative game perspective. Assuming that a monetary value has been attached to the additional injury caused by each actor, that problem is modeled as a transferable utility game to which standard solution concepts are then applied. The resulting game is convex. Its core is the set of "non-objectionable adjudications" and the Shapley value is a fair compromise between these various judgments. Asymmetries can be accommodated by assigning weights to tortfeasors. The resulting asymmetric Shapley value is a core allocation and, vice versa, weights can be associated to any core allocation. As a by-product, this paper illustrates how the cooperative approach may bring useful insights into legal questions. Furthermore, it shows that the Shapley value is of particular interest in a legal context because it is founded on axioms that are in line with fundamental principles of private law.
Keywords: cooperative game theory, Shapley value, multiple causation, tort law
JEL Classification: K13
Suggested Citation: Suggested Citation