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Daily routine teaches us that organizational structure matters when mistakes and accidents take place in organizations.1 For example, the safe operation of a train does depend not only on the skills of the engine driver but also on the proper organization of the railway company. This leads to the question whether it is possible to identify the organizational attributes that properly reflect the risk of accidents. And if such attributes can be identified, what are the legal consequences? Can liability rules and legal standards of care effectively address the organizational factors of accident occurrence and induce precautions at the organizational level? These are very topical questions. A striking example is the fatal Washington metro crash of 22 June 2009. The crash made it apparent that organizational deficiencies led to the systemic breakdown of safety management at all levels.2 According to a member of the National Transportation Safety Board (NTSB), the volume of alarms incorrectly detecting the location of trains was very high. But this technical problem was ignored persistently at all levels of the organization. Another NTSB member stated that “this accident was a classic example of an organizational accident”, blaming the metro’s employees, managers and board, as well as the designers and manufacturers of the train-control system. In the aftermath of the accident, the safety regulations for transit systems became tighter.3 But is more regulation the only answer to the mentioned problems?4 Can tort law adequately address these problems? In this article we ask whether it is possible to expand the scope of the economic analysis of tort law by incorporat-

From Individuals to Organizations: The Puzzle of Organizational Liability in Tort Law