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Over the past 30 years there have been enormous changes in the understanding of the economic effects of accident law. I believe that over the next decade there will be equally increased attention to the economic dimensions of the design of compensation systems.

All are aware of the strict liability revolution and the substantial expansion of liability that has occurred in the United States led by changes in the products field with the expansion of substantive liability and the reduction of defenses available against alleged tortfeasors. This change in approach toward the law, however, has extended far beyond products liability and has affected many other areas. It has affected insurance law and insurance interpretation. It has affected the interpretation of statutes of limitation. It has affected the way courts deal with expert testimony and with damages issues. It is a movement that is far more extensive than simply products liability alone, though, I believe that it was led by developments in products liability.

Within the products liability field, the movement was encouraged by the economic idea that greater liability would lead to salutary effects, both in terms of deterrence and in terms of providing compensation. Over the last 30 years, however, there has been a substantial re-analysis of those conclusions in the academic literature in the United States. The academic literature today is substantially different than what it was 30 years ago.

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