Accuracy in the Assessment of Damages / Louis Kaplow, Steven Shavell.

Format:

Book

Author/Creator:

Kaplow, Louis.

Contributor:

National Bureau of Economic Research.

Shavell, Steven.

Series:

Working Paper Series (National Bureau of Economic Research) no. w4287.

NBER working paper series no. w4287

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1993.

Summary:

Assessment of damages is a principle issue in litigation and, in light of this, we consider the social justification for, and the private benefits of, accurate measurement of harm. Greater accuracy induces parties to exercise levels of precaution that better reflect the magnitude of the harm they are likely to generate, and related, it stimulates uninformed parties to learn about risks before acting. However, accuracy in the assessment of harm cannot influence the behavior of parties -- and is therefore of no social value -- to the degree that parties lack knowledge of the harm they might cause when deciding on their precautions. In addition, regardless of the social value of accuracy, litigants generally gain by devoting resources toward proof of damages, leading often to socially excessive private incentives to establish damages.

Notes:

Print version record

March 1993.