Often, injurers or victims (or both) can adopt a new technology that reduces the social costs of accidents. When adoption costs are not verifiable in court, optimal adoption decisions cannot be induced by means of an appropriate determination of negligence. Hence the parties might either over- or under-adopt. We study how due-care standards should be conditioned on the technology adopted by the parties in order to improve adoption decisions. We demonstrate that standards should be biased upwards or downwards, depending on whether the new technology reduces or increases expected harm.
Innovative Negligence Rules / G. Dari Mattiacci;L. A. Franzoni. - In: AMERICAN LAW AND ECONOMICS REVIEW. - ISSN 1465-7252. - STAMPA. - 16:(2014), pp. 333-365. [10.1093/aler/aht021]
Innovative Negligence Rules
FRANZONI, LUIGI ALBERTO
2014
Abstract
Often, injurers or victims (or both) can adopt a new technology that reduces the social costs of accidents. When adoption costs are not verifiable in court, optimal adoption decisions cannot be induced by means of an appropriate determination of negligence. Hence the parties might either over- or under-adopt. We study how due-care standards should be conditioned on the technology adopted by the parties in order to improve adoption decisions. We demonstrate that standards should be biased upwards or downwards, depending on whether the new technology reduces or increases expected harm.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.