@techreport{96a1bdf6d55a4185838caeb4297aff49,
title = "Tailoring Negligence Standards to Accident Records",
abstract = "Traditional economic models of accident law are static and assume homogeneous individuals under perfect information. This paper relaxes these assumptions and presents a dynamic unilateral accident model in which potential injurers differ in their probability of accident. Information about individual risk-type is hidden from the social planner and from each potential injurer. We ask how negligence standards should be optimally tailored to individual risk-type when this is imperfectly observable. We argue that information about past accident experiences helps to efficiently define negligence standards, narrowing the distance between first-best standards perfectly tailored to individual risk-type and third-best averaged standards. We finally show that negligence standards refined on the basis of past accident experiences and of individual risk-type do not undermine private incentives to undertake due care.",
keywords = "Accident law, Individualized negligence standards, Negligence, Bayesian updating rule, Accident law, Individualized negligence standards, Negligence, Bayesian updating rule",
author = "Alice Guerra and Hlobil, {Tobias M.}",
year = "2015",
month = aug,
day = "10",
doi = "10.2139/ssrn.2650823",
language = "English",
series = "MPRA Paper",
publisher = "Munich Personal RePEc Archive",
number = "66281",
address = "Germany",
type = "WorkingPaper",
institution = "Munich Personal RePEc Archive",
}