Journal of Economic Perspectives: Vol. 5 No. 3 (Summer 1991)


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Liability for Medical Malpractice

Article Citation

Danzon, Patricia M. 1991. "Liability for Medical Malpractice." Journal of Economic Perspectives, 5(3): 51-69.

DOI: 10.1257/jep.5.3.51


Physicians and other medical providers are subject to a negligence rule of liability. In a simple model, with perfect information and homogeneous physicians, a negligence rule of liability with an appropriately defined due care standard should induce complete compliance: there should be no malpractice, no malpractice claims, and no demand for malpractice insurance. The malpractice experience is seriously at odds with this prediction. First, what goes wrong? Second, if the system does indeed operate imperfectly, does it yield benefits in terms of injuries deterred that outweigh the high overhead costs of operating a liability system?

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Danzon, Patricia M. (U PA)

JEL Classifications

K13: Tort Law and Product Liability
I11: Analysis of Health Care Markets


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