Comments on paper by Marcel Boyer and Donatella Porrini

Date15 August 2002
Publication Date15 August 2002
Pages269-280
DOIhttps://doi.org/10.1016/S0193-5895(02)20014-7
AuthorMichael Faure
COMMENTS ON PAPER
MARCEL BOYER AND
DONATELLA PORRINI
BY
Michael Faure
The topic addressed by Boyer and Porrini is a highly important one for the
economics of accident law. It deals with the central issue whether we should
use tort law and/or regulation to control externalities and if the conclusion would
be that the use of both instruments should be combined, the question arises
how such a combination should work.
A. CRITERIA FOR SAFETY REGULATION
The arguments in favor of safety regulation to control environmental risks are well
known. The choice between regulation and liability rules has been thoroughly
examined by Steven Shavell in 1984, in a paper in which he advances several
criteria that influenced the choice between safety regulation and liability rules.l
1. Information Asymmetry as a Criterion for Regulatory Intervention
Information deficiencies have often been advanced as a cause of market failure
and as the justification for government intervention through regulation. 2 Also,
for the proper operation of a liability system, information on, e.g. the existing
legal rules, the accident risk, and efficient measures to prevent accidents, is a
precondition for an efficient deterrence. According to Shavell, the parties in an
accident setting generally have much better information on the accident risk
An Introduction to the Law and Economics of Environmental Policy: Issues in Institutional
Design, Volume 20, pages 269--280.
© 2002 Published by Elsevier Science Ltd.
ISBN: 0-7623-0888-5
269

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