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A Cross‐National Study of Government Social Insurance as an Alternative to Tort Liability Compensation
Author(s) -
Kerr Dana A.,
Ma YuLuen,
Schmit Joan T.
Publication year - 2009
Publication title -
journal of risk and insurance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.055
H-Index - 63
eISSN - 1539-6975
pISSN - 0022-4367
DOI - 10.1111/j.1539-6975.2009.01303.x
Subject(s) - generosity , government (linguistics) , tort , liability insurance , liability , actuarial science , compensation (psychology) , payment , business , social insurance , variety (cybernetics) , sample (material) , public economics , economics , insurance policy , finance , law , political science , psychology , philosophy , linguistics , artificial intelligence , computer science , psychoanalysis , chemistry , chromatography
Litigation rates in the United States have long been considered out of proportion with the remainder of the world, leading to a good deal of economic research trying to understand the causes. Much of that literature has focused on lawyer compensation rules and availability of general damage awards. Another possible reason for differences in national litigation rates is the relative generosity of government social programs. Using a sample of 24 countries over a 12‐year period, we test the relationship between the size of government social program payments and liability costs as measured by liability insurance premiums, and find a strong negative relationship, controlling for income, accident rates, and a variety of other factors.