Strict Liability Versus Negligence in a Market Setting
15 Pages Posted: 4 Jul 2004 Last revised: 27 Aug 2010
Date Written: 1980
This paper formally analyzes strict liability and negligence in a market setting. The discussion emphasizes the impact of the rules on the market price and on the number of firms in the industry. For simplicity, the damage caused by each firm is assumed to be determined only by that firm's "care" (and not also by the firm's output or the victim's behavior).
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