On the Optimal Scope of Negligence
Review of Law and Economics, Vol. 1, No. 3, December 2005
31 Pages Posted: 17 Sep 2004
This article studies the optimal scope of negligence, considering which of the parties' precautionary measures should be included in the determination of negligence and which instead should be omitted. The analysis shows that the optimal scope of negligence balances the reduction of accident costs with the administrative costs of the system. This approach also provides insights on the notions of care and activity level and their boundaries, and on the choice between strict liability and negligence.
Keywords: activity level, care, precaution, negligence, evolution of liability.
JEL Classification: K00, K13
Suggested Citation: Suggested Citation