Liability for Robots II: An Economic Analysis

Guerra, A., Parisi, F., & Pi, D. (2021). Liability for robots II: An economic analysis. Journal of Institutional Economics, 1-16. doi:10.1017/S1744137421000837

16 Pages Posted: 11 Oct 2021 Last revised: 30 Nov 2021

See all articles by Alice Guerra

Alice Guerra

University of Bologna - Department of Economics

Francesco Parisi

University of Minnesota - Law School; University of Bologna

Daniel Pi

University of Maine - School of Law

Date Written: October 9, 2021

Abstract

This is the second of two companion papers that discuss accidents caused by robots. In the first paper (Guerra et al., 2021), we presented the novel problems posed by robot accidents, and assessed the related legal approaches and institutional opportunities. In this paper, we build on the previous analysis to consider a novel liability regime, which we refer to as “manufacturer residual liability” rule. This makes operators and victims liable for accidents due to their negligence—hence, incentivizing them to act diligently; and makes manufacturers residually liable for non-negligent accidents—hence, incentivizing them to make optimal investments in R&D for robots’ safety. In turn, this rule will bring down the price of safer robots, driving unsafe technology out of the market. Thanks to the percolation effect of residual liability, operators will also be incentivized to adopt optimal activity levels in robots’ usage.

Keywords: liability; negligence; manufacturer residual liability; automated technology

JEL Classification: K13, K32

Suggested Citation

Guerra, Alice and Parisi, Francesco and Pi, Daniel, Liability for Robots II: An Economic Analysis (October 9, 2021). Guerra, A., Parisi, F., & Pi, D. (2021). Liability for robots II: An economic analysis. Journal of Institutional Economics, 1-16. doi:10.1017/S1744137421000837, Available at SSRN: https://ssrn.com/abstract=3939486 or http://dx.doi.org/10.2139/ssrn.3939486

Alice Guerra (Contact Author)

University of Bologna - Department of Economics ( email )

Bologna
Italy

Francesco Parisi

University of Minnesota - Law School ( email )

229 19th Avenue South
Minneapolis, MN 55455
United States

University of Bologna ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

Daniel Pi

University of Maine - School of Law ( email )

246 Deering Avenue
Portland, ME 04102
United States

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