Punitive Damages: How Judges and Juries Perform

59 Pages Posted: 7 Jun 2002

See all articles by Joni Hersch

Joni Hersch

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

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

Multiple version iconThere are 2 versions of this paper

Date Written: May 2002

Abstract

A substantial recent literature has documented the inability of jurors to make sound decisions with respect to punitive damages, particularly for health, safety, and environmental torts. Included in this literature are experimental studies documenting the better performance of judges than jurors for the same case scenarios. Recent research by Eisenberg et al. (2002) has suggested, however, that there is no significant difference between the performance of judges and jurors with respect to punitive damages. Our paper provides a critical assessment of this finding as well as a detailed statistical analysis of the state court data upon which the Eisenberg et al. claim is based. Our analysis starts with a review of very large punitive damages awards. We found that 98 percent of the large punitive damages awards were made by juries and only two percent by judges. The jury awards in these large cases were highly unpredictable and were weakly correlated with compensatory damages. We then analyze data from the Civil Justice Survey of State Courts, 1996, which is the data set used by Eisenberg et al. Our analysis of the state court data set contradicts Eisenberg et al.'s analysis. We find that juries are significantly more likely to award punitive damages than are judges; juries award higher levels of punitive damages; and juries are largely responsible for extremely large punitive damages awards. Juries also tend to award higher compensatory damages, which in turn will often boost the punitive damages award. This paper also discusses the reasons why our results contradict the findings by Eisenberg et al.

JEL Classification: K00, K13, K41

Suggested Citation

Hersch, Joni and Viscusi, W. Kip, Punitive Damages: How Judges and Juries Perform (May 2002). Harvard Law and Economics Discussion Paper No. 362. Available at SSRN: https://ssrn.com/abstract=315349 or http://dx.doi.org/10.2139/ssrn.315349

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

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

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

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

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