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Responsibility, Liability, and Incentive Compatibility

Page, Talbot (1985) Responsibility, Liability, and Incentive Compatibility. Social Science Working Paper, 590. California Institute of Technology , Pasadena, CA. (Unpublished) http://resolver.caltech.edu/CaltechAUTHORS:20170914-142446945

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Abstract

In this paper I ask what should be the assignment of liability for risks of toxic chemicals, and more generally. I develop a theory of liability, based on two principles. The first is responsibility as own-cost-bearing and is justified on the grounds of fairness. The second is efficiency and is justified on the grounds of welfare. These two principles provide a joint foundation to the theory of incentive compatibility, which is an important consideration in the design of liability systems.


Item Type:Report or Paper (Discussion Paper)
Additional Information:I wish to thank Brian Barry, Alan Donagan, John Gillroy, Daniel Hausman, Leo llurwicz, Will Jones, Arthur Kuflik, Bart Schultz, Alan Schwartz, Alan Strudler and Steve Walt for many helpful comments. Published as Page, Talbot. "Responsibility, liability, and incentive compatibility." Ethics 97.1 (1986): 240-262.
Group:Social Science Working Papers
Subject Keywords:Strict liability, Chemical hazards, Cost efficiency, Legal liability, Incentive principles, Economic costs, Business risks, Normativity, Warnings, Cost incentives
Record Number:CaltechAUTHORS:20170914-142446945
Persistent URL:http://resolver.caltech.edu/CaltechAUTHORS:20170914-142446945
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:81455
Collection:CaltechAUTHORS
Deposited By: Jacquelyn Bussone
Deposited On:15 Sep 2017 17:37
Last Modified:15 Sep 2017 17:37

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