The Causes and Effects of Liability Reform: Some Empirical Evidence

46 Pages Posted: 27 Jun 2000  

Thomas J. Campbell

affiliation not provided to SSRN

Daniel P. Kessler

Stanford Graduate School of Business; National Bureau of Economic Research (NBER)

George B. Shepherd

Emory University School of Law

Date Written: January 1995

Abstract

We provide empirical evidence both on the causes and the effects of liability reforms. Using a newly collected data set of state tort laws and a panel data set containing industry-level data by state for the years 1969-1990, we (1) identify the characteristics of states that are associated with liability reforms and (2) examine whether liability reforms influence productivity and employment. We present two central findings. First, reductions in liability levels are associated with increases in measured productivity and employment in most industries that we studied. Second, liability reforms that reduce legal liability are generally positively correlated with measures of political conservatism.

Suggested Citation

Campbell, Thomas J. and Kessler, Daniel P. and Shepherd, George B., The Causes and Effects of Liability Reform: Some Empirical Evidence (January 1995). NBER Working Paper No. w4989. Available at SSRN: https://ssrn.com/abstract=226587

Thomas J. Campbell

affiliation not provided to SSRN

No Address Available

Daniel Philip Kessler (Contact Author)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States
650-723-4492 (Phone)
650-725-6152 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

George B. Shepherd

Emory University School of Law ( email )

1301 Clifton Road
Atlanta, GA 30322
United States
404-727-6978 (Phone)
404-727-6820 (Fax)

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