Cooter and Porat, ‘Torts and Restitution: Legal Divergence and Economic Convergence’

ABSTRACT
This Article explores the divergence in law and convergence in economics in dealing with harms and benefits. While tort law usually makes the injurer internalize wrongful harms through damages, restitution law does not enable the benefactor to internalize the benefits she confers on others without their request. In both harm and benefit cases, however, internalization seems to make economic sense for the same reason: injurers and benefactors alike will behave efficiently if they internalize the externalities that they create. The Article’s main goal is to develop eight liability rules for harms and benefits cases and to point out the symmetry between the rules relating to harms and the rules relating to benefits. It also provides an explanation for the legal divergence between tort law and restitution law, and makes the claim that the gap between these two fields should be narrowed. Finally, the article relates these eight rules to the main relevant categories of harm and benefit cases in positive law and appraises their advantages and disadvantages.

Cooter, Robert D and Porat, Ariel, Torts and Restitution: Legal Divergence and Economic Convergence (December 5, 2018) 92 Southern California Law Review (2019); University of Chicago Coase-Sandor Institute for Law and Economics Research Paper No 863.

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