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Strict Liability, Scarce Generic Input and Duopoly Competition

Author

Listed:
  • Gérard Mondello

    (Université Côte d'Azur, France
    GREDEG CNRS)

Abstract
This paper analyzes the impact of strict liability on imperfect competition and shows first that it is not an obstacle to achieving a socially optimal level of care. Second, this result is compromised when firms face a scarce generic asset. Under this asset limitation, this paper shows that competition (here a Cournot-Nash duopoly) leads to a lower level of prevention even if more product at lower price is supplied at the equilibrium. Introducing standards linked to operating permits improves the economy's safety level but may lead firms to exit.

Suggested Citation

  • Gérard Mondello, 2021. "Strict Liability, Scarce Generic Input and Duopoly Competition," GREDEG Working Papers 2021-24, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    • Handle: RePEc:gre:wpaper:2021-24
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Tort Law; Strict Liability; Negligence Rule; Imperfect Competition; Oligopoly; Cournot Competition;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics

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