Guerra and Parisi, ‘Accident Aversion: An Experiment’

Abstract
Tort models predict a symmetry in the behavior of tortfeasors and victims when respectively faced by strict liability or no liability. This paper relies upon the standard accident model and uses an original experimental design to investigate whether the prediction of the tort model holds in actual accident situations. Precisely, we study how individual care choices are affected by the role played by the subject in an accident – as a prospective tortfeasor facing strict liability or as a prospective victim facing the risk of uncompensated loss. Contrary to the theoretical predictions, the results of our experiment show that prospective tortfeasors and victims undertake different investments in precautions when faced with identical financial risks. Victims are more likely to invest in precautions than tortfeasors. We discuss the tort policy implications of our behavioral findings and their practical relevance for accident prevention.

Guerra, Alice and Parisi, Francesco, Accident Aversion: An Experiment (March 4, 2018).

First posted 2018-03-05 06:59:40

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