An Activity-Generating Theory of Regulation
当法院判决有误时，侵权诉讼的不确定性会抑制企业活动。本文提出监管可通过事前收集风险信息并设定安全标准来降低诉讼风险，从而提升社会福利。
We propose an activity-generating theory of regulation. When courts make errors, tort litigation becomes unpredictable and as such imposes risk on firms, thereby discouraging entry, innovation, and other socially desirable activity. When social returns to activity are higher than private returns, it may pay the society to generate some information ex ante about how risky firms are and to impose safety standards based on that information. In some situations, compliance with such standards should entirely preempt tort liability; in others, it should merely reduce penalties. By reducing litigation risk, this type of regulation can raise welfare.