ABSTRACT
In the context of the standard tort model of interaction between two parties, where it is assumed that in case of accident only one party suffers losses, efficient liability rules are characterized by the condition of negligence liability. The condition of negligence liability requires that whenever one party is negligent and the other nonnegligent, the negligent party must bear the entire loss in case of accident. This paper is concerned with the question of the efficiency of those liability rules that are efficient under the assumptions of the standard tort model, for the case when both parties to the interaction suffer losses in the event of accident. It turns out that when both parties to the interaction suffer losses in case of accident, the efficiency of liability rules crucially depends on whether there is a single trial or two trials, and whether in case of two trials they are treated as independent trials ..
Jain, Satish Kumar, On the Efficiency of Liability Rules When Both Victims and Injurers Suffer Losses (September 13, 2023).
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