The Divergence between Social and Private Incentives to Sue: A Comment on Shavell, Menell, and Kaplow

Rose‐Ackerman, Susan; Geistfeld, Mark

doi:10.1086/467839

Cited by 50 publications

(17 citation statements)

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“…However, Kaplow (1986) and Rose-Ackerman and Geistfeld (1987) showed that it remains true that the victim's private incentive to sue is not necessarily optimal. Thus, a rule prohibiting suit might still be socially desirable.…”

Section: Deterministic Damagesmentioning

confidence: 99%

“…Thus, as a general proposition, there is no reason to believe that the loser-pays rule will systematically improve the efficiency of the legal system (Shavell, 1997;Rose-Ackerman and Geistfeld, 1987). The same conclusion applies to contingent fees, under which plaintiffs only pay their legal fees if they receive a positive settlement amount or win at trial.…”

Section: Alternative Cost Rulesmentioning

confidence: 99%

“…2 Also see Menell (1983), Kaplow (1986), Rose-Ackerman and Geistfeld (1987), and Shavell (1997Shavell ( , 1999.…”

Section: Introductionmentioning

confidence: 99%

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The social versus private incentive to sue

Miceli¹

2017

Encyclopedia of Law and Economics

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The private value of lawsuits is based on plaintiffs' expected recovery at trial compared to their filing costs, whereas the social value consists of the incentives suits create for injurers to invest in accident avoidance. Generally, there is no relationship between these two values: there may be either too many or too few suits from a social perspective. Thus, there is scope for corrective measures, although there is no simple policy. Extending the model to consider a negligence rule rather than strict liability, and to allow for pretrial settlements, leads to some modified conclusions but does not alter the basic insights.Journal of Economic Literature Classification: K13, K40, K41

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Section: Deterministic Damagesmentioning

confidence: 99%

Section: Alternative Cost Rulesmentioning

confidence: 99%

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The social versus private incentive to sue

Miceli¹

2017

Encyclopedia of Law and Economics

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“…30 28 The literature has mainly been concerned with two problems: first, the effect of litigation costs on the levels of precaution actually taken by the parties (see Shavell (1987:ch. 11), Polinsky andRubinfeld (1988a, 1988b), Hylton (1990), Miceli and Segerson (1991), Polinsky and Che (1991), Kahan and Tuckman (1995), and Kaplow (1993)) and secondly, the desirability of liability when litigation is costly (see Shavell (1982), Menell (1983), Kaplow (1986), andRose-Ackerman andGeistfeld (1987)). On these grounds the relative advantages of different liability rules have been compared, see Goldberg (1984), Shavell (1987:264) and Miceli (1997:44) for an assessment.…”

Section: The Model With Administrative Costsmentioning

confidence: 99%

On the Optimal Scope of Negligence

Dari‐Mattiacci

2004

SSRN Journal

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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 gains derived from improved accident prevention with the administrative costs of the system. This approach also provides insights concerning not only the notions of care and activity level and their respective boundaries, but also the choice between strict liability and negligence.Stat rosa pristina nomine, nomina nuda tenemus **

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“…The purpose of this note is to extend 1 See Brown (1973), Landes andPosner (1987), andShavell (1987). 2 See, for example, Menell (1983), Kaplow (1986), Rose-Ackerman and Geistfeld (1987), Polinsky and Che (1991), and Shavell (1997, 1999. 3 It does not, however, entirely eliminate their incentive to take care to the extent that they have uncompensated losses.…”

Section: Introductionmentioning

confidence: 99%

A Note on the Social versus Private Value of Suits when Care is Bilateral

Miceli¹

2008

Review of Law &Amp; Economics

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This paper re-examines the social versus private value of lawsuits when both injurers and victims can take care. The basic conclusions of that literature remain valid in this context: the private and social values generally differ, and there is no necessary relationship between them, meaning that there may be either too many or too few suits. Introducing the possibility of victim care does, however, alter the calculation of the deterrent effect of lawsuits. In particular, because allowing suits tends to reduce the incentives for victims to invest in precaution, the social value of prohibiting suits increases in direct relation to the productivity of victim care in lowering accident risk.Journal of Economic Literature Classification: K13, K40, K41

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The Divergence between Social and Private Incentives to Sue: A Comment on Shavell, Menell, and Kaplow

Cited by 50 publications

References 1 publication

The social versus private incentive to sue

The social versus private incentive to sue

On the Optimal Scope of Negligence

A Note on the Social versus Private Value of Suits when Care is Bilateral

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