Filtering Tort Accidents

24 Pages Posted: 20 Jul 2020

See all articles by Jef De Mot

Jef De Mot

Ghent University - Faculty of Law

Ben Depoorter

University of California Hastings College of Law; Ugent - CASLE; Stanford Law School Center for Internet & Society

Thomas J. Miceli

University of Connecticut - Department of Economics

Date Written: June 26, 2020

Abstract

Conventional wisdom in the economic analysis of tort law holds that legal errors distort incentives, causing behavior to depart from the optimum. If potential injurers know that courts err, they may engage in less or more than optimal precaution. By contrast, when courts always set the care standard at the socially efficient levels, injurers are incentivized to take due care. This article revisits the effect of judicial error on the incentives of potential injurers by identifying a heretofore-neglected filtering effect of uncertainty in settings of imperfect judicial decision-making. We show that when courts make errors in the application of the liability standards, legal uncertainty filters out the most harmful torts but leaves unaffected less harmful accidents. Our insight applies to various procedural and institutional aspects of legal adjudication, including the randomization of case assignment, the strength of precedent, and the use of standards versus rules.

Keywords: tort law, deterrence, filtering

JEL Classification: K22

Suggested Citation

De Mot, Jef and Depoorter, Ben and Miceli, Thomas J., Filtering Tort Accidents (June 26, 2020). Available at SSRN: https://ssrn.com/abstract=3636457 or http://dx.doi.org/10.2139/ssrn.3636457

Jef De Mot

Ghent University - Faculty of Law ( email )

Universiteitstraat 4
Ghent, B-9000
Belgium

Ben Depoorter (Contact Author)

University of California Hastings College of Law ( email )

200 McAllister Street
San Francisco, CA 94102
United States

Ugent - CASLE ( email )

Universiteitstraat 4
Belgium

Stanford Law School Center for Internet & Society ( email )

559 Nathan Abbott Way
Stanford, CA 94305-8610
United States

Thomas J. Miceli

University of Connecticut - Department of Economics ( email )

365 Fairfield Way, U-1063
Storrs, CT 06269-1063
United States
860-486-5810 (Phone)
860-486-4463 (Fax)

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