The Modern Expansion of Tort Liability: Its Sources, Its Effects, and Its Reform

Abstract

This paper reviews the development of tort law during the 20th century with particular attention to the broad expansion of liability since the 1970s. It attempts to explain the origins of the expansion of liability; to present examples of its effects on product and service markets; and to analyze the extensive efforts of the past five to six years toward liability reform, efforts which I conclude have had only a slight relationship to the underlying sources of modern liability problems. Though the empirical evidence is thin, virtually all studies of the effects of specific modern rules demonstrate that modern tort law has substantially dislocated product and service markets, as one might expect of an assertive legal regime founded on largely noneconomic principles. As we shall see, market dislocations, especially for insurance, have increased sharply during the past decade.