New Economics Papers
on Law and Economics
Issue of 2009‒07‒17
two papers chosen by
Jeong-Joon Lee, Towson University

  1. COMPARATIVE VIGILANCE By Allan M. Feldman; Ram Singh
  2. Trial experience, satisfaction and incentive to bring another lawsuit: Does aspiration level influence winners and losers? By Yamamura, Eiji

  1. By: Allan M. Feldman (Department of Economics, Brown University Providence, RI 02906 USA); Ram Singh (Department of Economics, Delhi School of Economics, Delhi, India)
    Abstract: A growing body of literature suggests that courts and juries are inclined toward division of liability between two strictly non-negligent or “vigilant” parties. However, standard models of liability rules do not provide for vigilance-based sharing of liability. In this paper, we explore the economic efficiency of liability rules based on comparative vigilance. We devise rules that are efficient and that reward vigilance. It is commonly believed that discontinuous liability shares are necessary for efficiency. However we develop a liability rule, which we call the “super-symmetric rule,” that is both efficient and continuous, that is based on comparative negligence when both parties are negligent and on comparative vigilance when both parties are vigilant, and that is always responsive to increased care. Moreover, our super-symmetric rule divides accident losses into two parts: one part creates incentives for efficiency; the other part provides equity.
    Keywords: Comparative vigilance, equity, economic efficiency, tort liability rules, Nash equilibrium, social costs, pure comparative vigilance, super-symmetric rule
    JEL: K13 D61
    Date: 2008–11
  2. By: Yamamura, Eiji
    Abstract: This paper used individual level data in Japan to explore how a complainant’s past trial experience influences their satisfaction and incentive to bring a future lawsuit. Controlling for kinds of incidents and a complainant’s individual characteristics, the major findings were; (1) there is a positive relationship between the experience and satisfaction for winners, whereas there is a significant negative relationship for losers, and (2) experience exerts a positive effect on the intention to bring a future lawsuit, not only for winners but also for losers. These results imply that, for losers, a past experience enhances the incentive to bring a future lawsuit, although the experience decreases a complainant’s satisfaction.
    Keywords: Trial experience; Lawsuit satisfaction; future lawsuit; winner
    JEL: K40 L52 K41
    Date: 2009–07

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