Manufacturer liability for harms caused by consumers to others
By: Bruce Hay, Kathryn E. Spier.
Contributors: Spier, Kathryn E.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 10972; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 10972.
Publisher: National Bureau of Economic Research
Published: 2004
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Products liability.
Description: "Should the manufacturer of a product be held legally responsible when a consumer, while using the product, harms someone else? We show that if consumers have deep pockets then manufacturer liability is not economically efficient.  It is more efficient for the consumers themselves to bear responsibility for the harms that they cause.  If homogeneous consumers have limited assets, then the most efficient rule is "residual-manufacturer liability" where the manufacturer pays the shortfall in damages not paid by the consumer.  Residual-manufacturer liability distorts the market quantity when consumers' willingness to pay is correlated with their propensity to cause harm.  It distorts product safety when consumers differ in their wealth levels.  In both cases, consumer-only liability may be more efficient"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
Title from PDF file as viewed on 1/11/2005.
Also available in print.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.