New Directions in Liability Law

By Walter Olson | Go to book overview

A Choice-of-Law Approach to
Products-Liability Reform

MICHAEL W. MCCONNELL

In recent years, interest in products-liability reform has grown. But interest in federal legislation for that purpose has actually declined. Among the reasons are not only the political strength of reform opponents in Congress but also the difficulties inherent to the project. Congress, unlike the fifty state legislatures, generally and wisely refrains from experimental legislation, since federal mistakes are notoriously difficult to correct. It is hazardous to impose a single national "solution" to a problem without a reasonable confidence that the solution can be tolerated for years to come.

Reformers have therefore turned to the fifty states, which Justice Louis Brandeis dubbed "laborator[ies]" for conducting "novel social and economic experiments without risk to the rest of the country. " 1 Tort law has always been predominantly a state matter, and the prospects for rethinking the relation between tort liability, on the one hand, and innovation, competitiveness, and prosperity, on the other, would seem far more promising at that level. Indeed, more than thirty state legislatures passed some kind of tort reform in 1986 and 1987.

But there is a major structural obstacle to effective state reform that goes beyond the issue of political will. In a unified economy where products move in national markets, no state can ensure that its own consumers, manufacturers, and workers will capture the major benefits of reform legislation. This essay draws on the insights of the "public choice" school of economics and political science to show how the current legal structure militates against products-liability reform at the state level and, more tentatively, to argue that meaningful reform may require new federal rules governing the choice of law in products-liability cases.

____________________
Thanks are due to the Russell Baker Scholars Fund for financial support during the preparation of this essay, to Christopher R. DeMuth and Michael J. Horowitz, who worked with the author on these ideas some years ago at the Office of Management and Budget, and to Lea Brilmayer, David Currie, Richard Epstein, Larry Kramer, Fred McChesney, Bernard Meltzer, Richard Posner, and Alan Sykes for their probing comments on an earlier draft.

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