We analyze liability rules in a setting where injurers are potentially insolvent and where negligence standards may deviate from the socially optimal level. We show that proportional liability, which sets the measure of damages equal to the harm multiplied by the probability that it was caused by an injurer’s negligence, is preferable to other existing negligence-based rules. Moreover, proporti...

This paper examines auditor liability rules under imperfect information, costly litigation and risk averse auditors. A negligence rule fails in such a setting, because in equilibrium auditors will deviate with positive probability from any given standard. It is shown that strict liability outperforms negligence with respect to risk allocation, and the probability that a desired level of care is...

road managers, such as the ministry of roads and municipals, are in charge of the construction and maintenance of roads. in cases where the defect of the road or failure to observe the safety rules is effective in a car accident, the road managers may be considered as the liable of the harm. their liability is based on civil liability rules and approved special acts. we analyze the civil liabil...

Software is increasingly used to control systems that can cause harm to the consumer. There is consensus among commentators that many software systems are “products” for purposes of the law of products liability. However, strict products liability in tort has yet to be applied to software products. The day is certainly coming. The Restatement of the Law, Third, Products Liability, explains that...

Many communities are concerned about the reuse of potentially contaminated land (brownfields) and believe that environmental liability is a hindrance to redevelopment. However, with land price adjustments, liability might not impede the reuse of this land. This article studies state liability rules-specifically, strict liability and joint and several liability-that affect the level and distribu...

The willingness of landowners to allow fee-based recreational use of their land was investigated using data obtained from a mailed questionnaire sent to landowners in the Delta region of Louisiana. Previous studies have identified that landowners often chose not to engage in recreational leasing due to liability concerns. An institutional change that reduces liability risk to landowners may inc...