Tort Law

This chapter presents an overview of the behavioral analysis of tort law. It begins by presenting a summary of traditional economic analysis of tort law. That done, it examines various tort regimes (i.e., negligence and strict liability), as well as alternative legal regimes that base liability on the creation of risk rather than the materialization of harm, in light of the bounded rationality of potential tortfeasors and adjudicators. The chapter further explores the implications of behavioral findings for the calculation of damages in tort cases. Finally, it addresses the topic of product liability law, and highlights the ramifications of consumers’ bounded rationality for this area of law.