Abstract

As applied by courts, the Hand Rule balances the injurer's burden of precaution and the victims' reduction in risk. In this application, risk to oneself does not increase the duty owed to others. Economists, however, use the Hand Rule to minimize social costs, which requires balancing the burden of precaution against the reduction in risk to everyone. For economists, risk to one's self counts in determining the duty owed to others. In cases where precaution reduces joint risk (risk to oneself and others), the usual legal interpretation underestimates the reduction in risk relative to the economic interpretation, often by 50 percent. The consequence is a lower standard of legal care than required to minimize social costs. Judges should reconceptualize the Hand Rule so that risk to oneself increases the care owed to others.

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