ABSTRACT
This chapter begins by noting the centrality of the concept of negligence in tort law. Over the twentieth century, the rule of comparative negligence has assumed dominance in which liability is apportioned. The chapter traces the origin of the economic analysis of law and the claim that efficiency is the single dominant value explaining common law rules. An elaboration of the concept of efficiency as used in the economic analysis of law is provided. In the literature on the economic analysis of tort law the main results establish that liability rules are efficient if and only if they satisfy the following condition: if one party is negligent and the other is not, then the negligent party must bear the entire liability. The efficiency question hinges crucially on the way the notion of negligence is conceptualized – the result holds if negligence is taken as a shortfall from a due care level but does not hold if negligence is defined as the existence of some cost-justified untaken precaution. This chapter also discusses the legal literature to bring out some of the alternative conceptualizations, and in the process some vital concepts in the question of negligence determination are covered.
