VANDERBILT UNIVERSITY LAW SCHOOL

LAW & ECONOMICS

Working Paper Number 02-15

TWENTIETH CENTURY TORT THEORY

JOHN C. P. GOLDBERG

A revised version of this paper is forthcoming

Georgetown Law Journal (2002)

This paper can be downloaded without charge from the

Social Science Research Network Electronic Paper Collection:
http://ssrn.com/abstract_id=347340
 John C. P. Goldberg
TWENTIETH CENTURY TORT THEORY
Forthcoming, 90 Georgetown L. J. ___ (2002)

Abstract

This article analyzes twentieth-century tort scholarship in terms of a five-sided

debate between compensation-deterrence theory, enterprise liability theory, economic
deterrence theory, social justice theory, and individual justice theory. It surveys, parses,
and analyzes the central interpretive and prescriptive claims made by each of these
theories, exploring and exposing to criticism their underlying assumptions and
commitments. The article concludes with a plea for greater theoretical self-
consciousness among tort scholars, and for a shift in focus away from the strict-liability
v. negligence debate.
 Twentieth Century Tort Theory
JOHN C. P. GOLDBERG*

INTRODUCTION

I. THE TRADITIONAL ACCOUNT

II. COMPENSATION-DETERRENCE THEORY

A. INTERPRETIVE COMPENSATION-DETERRENCE THEORY
1. HISTORICAL AND FUNCTIONAL CLAIMS
2. CONCEPTUALIZING DOCTRINE IN TERMS OF FUNCTION
B. PRESCRIPTIVE COMPENSATION-DETERRENCE THEORY
C. CRITICISMS OF COMPENSATION-DETERRENCE THEORY

III. ENTERPRISE LIABILITY THEORY

A. INTERPRETIVE ENTERPRISE LIABILITY THEORY
B. PRESCRIPTIVE ENTERPRISE LIABILITY THEORY
C. CRITICISMS OF ENTERPRISE LIABILITY THEORY

IV. ECONOMIC DETERRENCE THEORY

A. INTERPRETIVE ECONOMIC DETERRENCE THEORY
B. PRESCRIPTIVE ECONOMIC DETERRENCE THEORY
C. CRITICISMS OF ECONOMIC DETERRENCE THEORY

V. SOCIAL JUSTICE THEORY

A. INTERPRETIVE AND PRESCRIPTIVE SOCIAL JUSTICE THEORY
B. CRITICISMS OF SOCIAL JUSTICE THEORY

* Professor, Vanderbilt University Law School. This Article is dedicated to the

memory of Gary Schwartz, who always sought to promote understanding among torts
scholars. It may re-appear in part in JOHN C. P. GOLDBERG, ANTHONY J. SEBOK &
BENJAMIN C. ZIPURSKY, TORT LAW: RESPONSIBILITIES AND REDRESS (Aspen)
(forthcoming). Thanks to Heidi Li Feldman for organizing the New Negligence
Conference, and to Heidi, Mark Geistfeld, Steve Hetcher, Ellen Smith Pryor, and Ben
Zipursky for very helpful criticisms and suggestions, as well as to members of the
faculties of Michigan, Vanderbilt, and Washington University Law Schools for
commenting on earlier drafts. Thanks also to Mark Brandon, Homer Goldberg, Chris
Guthrie, Don Herzog, Deak Nabers, Richard Nagareda, Mark Osiel, Robert Rabin,
and Tony Sebok for their comments. This Article was supported by a research grant
from Vanderbilt Law School.
VI. INDIVIDUAL JUSTICE THEORY
A. LIBERTARIAN THEORY
1. INTERPRETIVE LIBERTARIAN THEORY
2. PRESCRIPTIVE LIBERTARIAN THEORY
3. CRITICISMS OF LIBERTARIAN THEORY
B. RECIPROCITY THEORY
1. INTERPRETIVE RECIPROCITY THEORY
2. PRESCRIPTIVE RECIPROCITY THEORY
3. CRITICISMS OF RECIPROCITY THEORY
C. CORRECTIVE JUSTICE THEORY
1. INTERPRETIVE CORRECTIVE JUSTICE THEORY
2. PRESCRIPTIVE CORRECTIVE JUSTICE THEORY
3. CRITICISMS OF CORRECTIVE JUSTICE THEORY

CONCLUSION

INTRODUCTION
As we consider the “new negligence,” it might be useful to
try to set the record straight on the thinking of the last century;
one which is growing distant more rapidly than the calendar
would suggest. This Article undertakes that task by analyzing
five idealized tort theories representing the dominant
approaches to tort in twentieth-century U.S. and Canadian torts
scholarship.1 The five are labeled: compensation-deterrence
theory, enterprise liability theory, economic deterrence theory,
social justice theory, and individual justice theory.2 Specific
disputes in modern tort law -- for example, whether to hold

1 What follows is an exercise in analytic reconstruction, which perhaps requires

justification. One justification is that torts scholarship has not always been notable
for its sophistication, nor for the theoretical self-consciousness of its participants. To
the extent this Article can identify and parse some of the basic claims and
assumptions of leading tort theories of the past century, and to isolate genuine points
of disagreement between them, it perhaps can help foster clarity and insight in the
torts scholarship of the new century.
2 In focusing on five theories, this chapter excludes other analytic approaches to

tort, such as feminist theories. Likewise, it does not attempt to survey the empirical
literature on the workings of tort law and alternative systems. These omissions are
not intended as a judgment of the merits of the omitted scholarship. Rather, they
reflect a decision to focus on theories that have set the terms of ‘mainstream’ debate
among torts scholars. Finally, the Article focuses on U.S. and Canadian scholars
largely because theorizing about tort is more of a preoccupation among them than
their counterparts in other countries.

2
actors liable for accidental harms under a standard of fault or
strict liability -- have taken place within the conceptual space
created by these theories.3
In articulating these theories, it will be helpful to further
distinguish two aspects of each: the interpretive aspect and the
prescriptive aspect. In its interpretive aspect, a tort theory
purports to make sense of the tort law that we have. As such, it
may combine various types of claim that, together, offer an
overall interpretation of the tort landscape. In particular, a
given interpretation of tort might be comprised of: an historical
account of how modern tort law came to look as it now does; a
set of conceptual claims as to what tort doctrines and rules
actually mean; and a functional account of the ends that are
promoted by tort law. For example, some versions of
interpretive economic deterrence theory combine the historical
claim that modern negligence law emerged out of a litigation
process that promotes the development of efficient rules, with a
conceptual claim that the fault standard in negligence is best
understood as expressing an idea of inefficiency or waste, with a
functional claim that the fault standard operates so as to
promote efficient precaution-taking.4
The prescriptive aspect of tort theories offers an account of
what tort law ought to look like. Such an account might be
offered hypothetically. As such, it takes a conditional form: If
tort is to serve goal G, it ought to take the form F. Alternatively,
a prescriptive claim might be offered categorically. In this cast,
it asserts directly that tort ought to serve goal G, and therefore
ought to take the form F. To return to the example of economic
deterrence theory, in its prescriptive aspect, the theory asserts --
either hypothetically or categorically, depending on the theorist -
- that tort law ought to look a certain way if it is to promote
efficient deterrence, or that tort law ought to be replaced by a
system that can better promote efficient deterrence.5

3 Talk of theory, at least with a capital ‘T’, sometimes scares American legal

academics. In this Article’s usage, a theory is simply a self-conscious attempt to say

something general about the subject in question. Thus, for “theories of tort,” one
might substitute “perspectives on tort,” “conceptions of tort,” or “approaches to tort.”
4 See infra Part III.A.
5 See infra Part III.B. It might be useful to diagram this taxonomy:

3
 The five theories discussed herein were not developed in a
linear time sequence. Nonetheless, the analysis will proceed in
a loosely chronological fashion. Part I sets the stage by briefly
describing the “traditional account” of tort.6 With this
groundwork laid, Parts II-V provide analysis, respectively, of
compensation-deterrence theory, enterprise liability theory,
economic deterrence theory, and social justice theory. Although
competitors, each of these theories begins from the premise that
the traditional account of tort fell apart at the turn of the
twentieth century, thus requiring radically different theories of
what tort law is, does, and/or ought to do. Part VI turns to
consider individual justice theories. These form a diverse
family, yet, in contrast to the preceding four theories, many of
them offer analyses of tort law more in keeping with the
traditional account. In its Conclusion, the Article identifies
some lessons that might follow from this analytic survey.

I. THE TRADITIONAL ACCOUNT.

At the time of the founding of the United States, the word
“tort” was sometimes used, as it is today, to refer to the
department of civil law that houses actions for assault, battery,

Tor t Th eor y

In t er pr et ive Aspect P r escr ipt ive Aspect

H ist or ica l Con cept u a l F u n ct ion a l H ypot h et ica l Ca t egor ica l

This taxonomy does not purport to offer an exhaustive or timeless list of the kinds of
claims legal theories can or do contain. As I suggest below, see infra note 135, there
are important distinctions among theoretical claims that cut across these categories.
Also, I do not claim that these categories are hermetically sealed with respect to one
another in the way, for example, that Ronald Dworkin sometimes is taken to suggest
that “fit” and “justification” are completely independent aspects of theories of law.
RONALD DWORKIN, LAW’S EMPIRE 230-31 (1986). Instead, I offer them merely as
provisional categories that can help clarify disputes about tort law.
6 I use “account” rather than theory deliberately. The traditional account was

never really theorized, in part because there was neither a felt need for such a theory,
nor obvious institutional alternatives against which to assess the contours and worth
of tort law. Moreover, the primary focus of this Article is dominant twentieth-century
tort theories. As explained below, the most prominent of these theories were created
to fill a vacuum created by the perceived breakdown of the traditional account. Thus,
it would be inappropriate to identify that account as a “twentieth-century” tort theory.
None of this is to say that the traditional account has no modern defenders, nor that it
has ceased to inform twentieth-century judicial decision-making. Rather, it is simply
to say that it has tended to serve as a foil for the past century’s academic theorizing
about tort.

4
fraud, libel, nuisance, and so forth. Alternatively, it was used
more broadly as a synonym for “wrong” or “trespass” in its
biblical sense. Even jurists who did not use tort in the first
sense seem to have recognized the department of law to which
“tort,” in that usage, referred. They just used different labels for
it, such as “the law of civil wrongs,” “the law of private wrongs,”
“the law of delict,” or the law of trespass and case. Blackstone
used several of these phrases interchangeably, including “tort”
in its modern usage.7
Whatever the label, late-eighteenth and early-nineteenth
century jurists operated with a certain conception of ‘tort’. To
them, tort was the part of the civil side of common law that
identifies, and provides redress for, injurious wrongs committed
by a citizen -- or in certain instances, a state actor -- onto
another citizen.8 It will be useful for purposes of subsequent
exposition to highlight several ideas implicit in this thumbnail
description.
First, as compared to property or criminal law, tort was
regarded as occupying a somewhat less significant place within
the legal system.9 This is not to say that it was regarded as
trivial or superfluous. Rather, on the traditional account, it
played a limited, yet indispensable role.10 To invoke modern
analogies, it served within the system of common law in a
manner akin to the “sixth man” on a basketball team, or to a
secondary character in a film: its time on court (on screen) was
limited, yet still critical to the success of the team (narrative).
Second, on the traditional account, tort law was
understood, like its more prominent cousin criminal law, to set
standards of right and wrong conduct. Writs such as trespass
and trespass-on-the-case, in all their variations, provided a
catalogue of the ways in which a citizen (or official) could do
wrong to another.11 A writ of trespass for battery, for example,

7 3 WILLIAM BLACKSTONE, COMMENTARIES ON THE LAWS OF ENGLAND 116-17

(facsimile ed. 1979) (1765-69).

8 Id. at 129-138 (linking habeas corpus to the tort of false imprisonment).
9 Blackstone, for example, devoted Books II and IV of the Commentaries to

property and criminal law, whereas tort takes up less than half of Book III, which also
covers what we would today call civil procedure and remedies. 3 BLACKSTONE, supra
note 7, at 115 –269.
10 See 1 BLACKSTONE, supra note 7, at 55-56.
11 See 3 BLACKSTONE, supra note 7, at 115-223 (cataloguing the various actions

for wrongs to person and property).

5
alleged the wrong of one citizen beating another. An action on
the case for words (slander) consisted of making statements
about another so as to expose him to ridicule. An action on the
case for malpractice asserted that the defendant provided
services to a client without the skill ordinarily exercised by
members of the profession.
Although resembling criminal law in its concern to
identify and respond to wrongful conduct, tort was also regarded
as distinct in two respects. First, in tort, the power to commence
suit against an actor alleged to have violated a tort standard
resided only in the person or entity who claimed to have suffered
injury as a result of the violation, rather than in a government
official. Tort actions, in this sense, were understood as personal
to the victim; as empowering a wronged person to commence
proceedings to vindicate his rights or interests.12 Second, the
tort suit, if successful, ordinarily entailed that the court would
order the tortfeasor to provide redress to the victim, usually in
the form of money damages. Tort was thus conceived of as a law
of personal redress rather than a law of public regulation or
punishment.13
If the term “formalist” suggests a view that tort law exists
for its own sake, or because it happens to provide entertaining
puzzles for lawyers and academics, then the traditional account
was not formalist. Indeed, if one were to ask a thoughtful
lawyer from the early nineteenth century what purpose tort law
served, he probably would answer that it was one part of a
system of common law that, overall, aimed to specify and protect
individuals’ rights to bodily integrity, freedom of movement,
reputation, and property ownership.14 If not formalist, however,
the traditional account was probably complacent. Most British
and early-American lawyers seemed content to assume that tort
belonged within a system of common law jurisprudence, and
that that system best served the aims of liberal government.
12 The starkest expression of this feature of the traditional account was the rule,

now largely superceded by statute, that the death of either the plaintiff or defendant
mooted or preempted a tort suit between them. As the dispute was personal, no one
else had any legitimate claim to pursue it. 3 BLACKSTONE, supra note 7, at 302 (noting
this rule).
13 Id. at 116.
14 See John C. P. Goldberg, Rights and Wrongs, 97 MICH. L. REV. 1828, 1828-29

(1999) (reviewing ARTHUR RIPSTEIN, EQUALITY, RESPONSIBILITY AND THE LAW (1999))
(briefly elaborating this parallelism).

6
With some digging, one can find a more elaborate attempt at a
justification in the pages of Blackstone. For the most part,
however, tort, like the rest of the common law, was taken for
granted.
The traditional account also entailed or presumed a
certain picture of the adjudication of tort suits. The latter were
understood as occasions to resolve disputes over whether an
actor (or actors) could be held responsible under the law for
injuries suffered by the plaintiff(s). In resolving these disputes,
the judge and jury were, moreover, supposed to apply prevailing
law to the facts of the case to determine whether the plaintiff
had been wronged by the defendant and was entitled to redress
from him.15 By the mid-nineteenth century, commentators
began to structure these rules and concepts around formal
“elements” and “defenses.”16 Thus, a plaintiff bringing a claim
for battery would have to prove the elements of act, intent,
causation, and harmful (or offensive) bodily contact, while a
negligence plaintiff was required to establish duty, breach, cause
in fact, proximate cause, and injury. Legal analysis of these
elements in turn would require the deployment of concepts such
as reasonableness, foresight, directness, etc.
Finally, the traditional account supposed that, by
applying legal rules, principles and concepts in this manner,
judges and jurors were bringing to bear social norms of
responsibility that had been refined and elaborated over time
through lawyerly analysis. To be sure, the analytic elements of
tort causes of action, and the concepts embedded within them,
were recognized as constructs of the law. The traditional
account did not treat them as “natural” or “pre-political” or
“transcendental,” but instead as part of a specialized language

15 These latter propositions may seem obvious to the point of banality. In fact,
they tend to be rejected by modern tort theories. It is worth mentioning, as an aside,
that nothing about the traditional account’s conception of the adjudication of tort
cases commits it to a “deductive” conception of legal reasoning, nor to a naïve view of
the processes of discovery and trial. Rather, it only requires a rejection of extreme
forms of law- and fact-skepticism, such as those which suggest that legal rules and
standards are devoid of content, and that trial proceedings are not merely prone to
error, but have little or no success in identifying what actually happened between
plaintiff and defendant.
16 John C. P. Goldberg & Benjamin C. Zipursky, The Moral of MacPherson, 146

U. PA. L. REV. 1733, 1747 (1998) (describing treatise definitions of negligence).

7
created by lawyers, judges and scholars.17 Still, it regarded
these categories and concepts as connected to the social life they
helped to construct and govern. Even if did not simply parrot
ordinary notions of wrongdoing and responsibility, the common
law of torts was built around and articulated such notions.
Thus, the elements and concepts of tort law, at least in the
hands of a competent judge and conscientious jury, were thought
to be “the natural flowerings of behavior in its customary forms,”
rather than “rules artificially developed and imposed from
without.”18
With the approach of the twentieth century, the traditional
account of tort faced an interrelated set of challenges prompted
by changing material, political and intellectual conditions. As
we will see, much of twentieth century tort theory is predicated
on the notion that the traditional account could not survive
these challenges. Hence the felt need for new interpretive and
prescriptive theories of tort.
The most basic challenge posed by modernity was the rapid
development of the industrial economy. With industrialization,
workplace, vehicular, and product-related accidents began to
emerge as a central, if not the central, problem with which tort
law had to deal, dwarfing in importance torts such as
defamation, trespass, and nuisance. As these sorts of accidents
moved to the fore, the interpretative focus offered by the
traditional account came to seem off-center. The image of the
eclectic gallery of wrongs seemed no longer to fit a world that
was coming to be dominated by the problem of physical injuries
caused by accidents. Moreover, the sorts of accidents on which
tort law would be focusing did not look like traditional “A hits B”
torts. These new accidents tended to arise out of conduct – e.g.,
shop-floor and product design -- that lacked immediate
counterparts in ‘everyday’ life and ordinary morality. Thus,
modern torts did not lend themselves to straightforward
attributions of wrongdoing and responsibility in accordance with
social conventions.

17 Thus, Blackstone distinguished between self-help, such as self-defense, which

constisted of a right granted by the law of nature, from the legal remedies provided by
English courts and law. 3 BLACKSTONE, supra note 7, at 2-4.
18 Pokora v. Wabash R. Co., 292 U.S. 98, 105 (1934) (Cardozo, J.).

8
 Politically, the traditional account was challenged in
several ways. First, the phenomenon of accidents became
sufficiently widespread to have rendered tort, for the first time,
a significant social and political issue.19 Tort could no longer
occupy a quiet corner of the common law under the political
radar. Moreover, as the American polity gradually became more
democratic, injuries suffered by ordinary persons came
increasingly to occupy the attention of the courts, in part thanks
to the loosening of restrictions on contingency fee
arrangements.20 The conventional model’s complacency was
also challenged by the emergence of other related political and
legal institutions. In particular, cooperative schemes of
insurance and early versions of the welfare state -- workers’
compensation schemes, especially -- emerged as potential
complements or alternatives to the tort system. The mere
existence of these alternatives permitted jurists and politicians
to think seriously about and fashion systematic legal responses
to the problem of accidents outside of tort law.21
Changes in political sensibilities also began to work against
the conventional conception. The same mid-to-late nineteenth-
century judges who were inclined toward recognizing a broad
realm of freedom of contract against state regulation were often
equally individualistic in tort. So, for example, they were
sometimes reluctant to impose tort duties that, in their eyes,
would be unduly burdensome on the liberty of actors, particular
businesses.22 The leading example of this mindset was, of
course, the privity rule for injuries caused by products.23
Likewise, they were apt to assign responsibility for injuries to
victims through defenses such as contributory negligence and

19 John C. P. Goldberg, Unloved: Tort in the Modern Legal Academy, 55 VAND. L.

REV. (forthcoming October 2002).
20 Peter Karsten, Enabling the Poor to Have Their Day in Court: The Sanctioning

of Contingency Fee Contracts, A History to 1940, 47 DEPAUL L. REV. 231, 241 (1998).
21 John Fabian Witt, Toward a New History of American Accident Law: Classical

Tort Law and the Cooperative First Party Insurance Movement, 114 HARV. L. REV.
691, 774-833 (2001) (describing early insurance schemes).
22 In the years before 1850, the Barons of the Court of Exchequer seem to have

been particularly eager to limit businesses’ liability. See Michael A. Stein, Priestley v.
Fowler (1837) and the Emerging Tort of Negligence (manuscript on file with author).
23 See Goldberg & Zipursky, supra note 16, at 1750-51.

9
assumption of risk.24 As populism and progressivism emerged
as powerful political movements, tort, no less than the
constitutional doctrine of due process, was damaged by its
association with laissez-faire.
Conceptually, jurists influenced by emergent strands of
pragmatism, empiricism, and logical positivsm came to the
conclusion that pre-modern lawyers and judges had been fooling
themselves into thinking that the rules and concepts of tort law
could actually guide the adjudication of tort disputes.25 Perhaps
in earlier times these concepts were serviceable devices by which
judges and juries could read customary morality into the law.
With the collapse of the pre-modern world, however, these
concepts seemed to lose their grounding and their content.
Instead, they served as empty labels, or smokescreens, by which
judges could purport to justify decisions without actually
offering any pragmatic or policy reasons for them. Questions as
to whether a defendant owed a duty to the plaintiff, or whether
the defendant’s carelessness was a proximate cause of plaintiff’s
injury, had become meaningless, if they ever were meaningful.
Thus, it was no surprise to find that judges filled these blanks
with their own beliefs as to sound policy. For example, when
late nineteenth century judges adopted the privity rule limiting
liability for defective products, they did so not because that
result was in any way compelled by the concept of duty, but
because they happened to think that sound reasons of economic
policy favored limiting businesses’ liability.26
In sum, the material, political and intellectual
circumstances in which tort operated changed significantly in
the late nineteenth and early twentieth centuries. The
traditional account – under which tort law was understood as a
set of rules and concepts, grounded in ordinary morality, for
resolving disputes over alleged wrongs committed by A against
B – was no longer obviously in tune with modern realities or
modern political and intellectual sensibilities. Indeed, many
would soon conclude that, if tort was to be explained or
defended, it would have to be on new grounds. This would be
24 See WILLIAM L. PROSSER, HANDBOOK OF THE LAW OF TORTS §51, at 391 (1941)

(condemning a long line of decisions invoking assumption of risk in suits by employees

against employers).
25 Goldberg & Zipursky, supra note 16, at 1757-58, 1800-02.
26 Id. at 1760-61.

10
the dominant project of twentieth-century American tort theory
in the first seventy years of the century.

II. COMPENSATION-DETERRENCE THEORY

The most influential torts scholars in the Twentieth
Century form a diverse group that may be placed under the
banner of compensation-deterrence theory. Holmes was the
theory’s grandfather. It was developed in earnest by mid-
century proponents such as Leon Green and William Prosser.
Some of its most prominent later-century adherents have
included Kenneth Abraham, Michael Green, James Henderson,
William Powers, Robert Rabin, Gary Schwartz, Aaron Twerski
and John Wade. These scholars have largely defined the
universe of torts for thousands of lawyers and judges through
their books, treatises, and articles. This same group has taken
the lead role in drafting the American Law Institute’s influential
“restatements” of tort law, as well as the 1991 “Reporters’
Study” of the American tort system.27 Moreover, a great deal –
perhaps the majority – of twentieth century torts scholarship
has consisted of ‘normal science’ undertaken within the
paradigm of compensation-deterrence theory.
To readers familiar with the academic literature of tort
theory, the attribution of such great success to compensation-
deterrence theory may seem odd, given that it is hardly ever
mentioned there. This is in part because its adherents often
have disagreed among themselves on substantive tort issues. It
is also because these scholars tend to express skepticism about
the utility of ‘theorizing’ or ‘philosophizing’ -- modes of analysis
they regard as antithetical to the sort of functional,
instrumental, pragmatic, or purposive analysis in which

27Each of the foregoing has served as author or co-author on a major torts

casebook or torts primer. Most have played central roles in the ALI’s work on torts.
Deans Prosser and Wade served as the Reporters for the Second Restatement. See 4
RESTATEMENT (SECOND) OF TORTS, at v (1979). Professors Abraham and Rabin were
among the authors of the Reporter’s Study. See 1 REPORTERS’ STUDY, ENTERPRISE
LIABILITY FOR PERSONAL INJURY, at v (1991). Professors Green, Henderson, Powers,
Schwartz, and Twerski have served or are serving as Reporters for the Third
Restatement. See RESTATEMENT (THIRD) OF TORTS: APPORTIONMENT OF LIABILITY v
(1998); RESTATEMENT (THIRD) OF TORTS: PRODUCTS LIABILITY, at v (1998);
RESTATEMENT THIRD OF TORTS: LIABILITY FOR PHYSICAL HARM (BASIC PRINCIPLES), at v
(Tentative Draft No. 2, 2002).

11
scholars might usefully engage.28 Contained within these
professions of theory-skepticism is an implicit disclaimer: “We
are in the business of sober, grounded analysis; we don’t engage
in idle theorizing.” The adoption of this posture seems to have
been fantastically effective. Indeed, compensation-deterrence
theory enjoys a unique status as the only mode of theorizing
about tort that has been spared the need to explain and justify
itself. If one looks past this disclaimer, however, one discovers
that compensation-deterrence theory is no more or less a theory
of tort than the other theories canvassed here.

A. INTERPRETIVE COMPENSATION-DETERRENCE THEORY

Invoking the taxonomy described in the introduction, we
can begin to isolate the core features of compensation-deterrence
theory by considering its interpretive aspect, beginning with a
related set of historical and functional claims developed and
endorsed by some of its members.

1. HISTORICAL AND FUNCTIONAL CLAIMS

Compensation-deterrence theory accepts as its premise that
tort suits probably once did fit the traditional account described
in Part I, i.e., did involve the resolution of relatively simple
disputes by the application of legal rules and principles that
were intelligible because they corresponded to common-sense
notions of wrongdoing and responsibility drawn from everyday
life. In the typical action, plaintiff P complained that defendant
D had violated a right of his conferred by some relatively
uncontroversial moral norm or tenet (e.g., the norm against
intentionally and unjustifiably striking another), which norm
had been incorporated into the formal law through the old
common law writs such as the writ of trespass. If P could make
out such a claim, he could then expect satisfaction from D in the
form of a compensatory payment. Thus, pre-modern tort law
was characterized by the adjudication of private disputes by
judges and juries who, through the formalities of the legal

28 See, e.g., Robert L. Rabin, Law for Law’s Sake 105 YALE L.J. 2261, 2283 (1996)

(reviewing ERNEST WEINRIB, THE IDEA OF PRIVATE LAW (1995)) (emphasizing the need
for attention to “purposive” concerns of tort law); William L. Prosser, Book Review, 27
CORNELL L.Q. 292, 294 (1942) (observing, in the course of an amusing diatribe against
attempts to philosophize about law, that: “I never have seen why law should make
any more sense than the rest of life ….”).

12
system, employed ordinary moral principles to determine
whether a given defendant had violated plaintiff’s rights, and
therefore became obligated, as a matter of justice, to undo the
harmful effects of his wrong through compensation.
In the late nineteenth and early twentieth centuries,
however, the character of the typical tort suit fundamentally
changed. In some respects the change was subtle. Indeed, an
observer who focused only on the outward form of tort suits, or
the language used by lawyers and judges in resolving such suits,
might miss it altogether. After all, twentieth century tort
actions still involved a P commencing a suit against a D for
compensation for injuries caused by D. Moreover, lawyers and
judges still analyzed these claims in terms of the traditional
language of tort law. These outward consistencies were
misleading, however. Tort had in fact retained only the shell of
the traditional account. In substance it was a new creature
entirely.29
Although Ps were still suing Ds, the Ds increasingly were
not individuals, but intangible entities, such as D Corp.
Moreover, the substance of P’s claim was not that entities such
as D Corp. could be held “responsible” for having wronged and
injured P. Rather the owners of D Corp. -- shareholders – were
being charged, via respondeat superior, for damage caused by
the acts of individual employees.30 On this view, to ascribe
“wrongdoing” to a corporation is mistakenly to treat an
incorporeal entity as if it were a natural person, thereby
assigning responsibility for wrongs to individuals who had done
no wrong (i.e., owners) on the basis of a fiction.31
In addition, tort suits no longer could be accurately
described as adjudicating the issue of whether D had flouted
some established principle of conventional morality incorporated
into law. This was the case for several reasons. With modernity
came increasing doubt as to the possibility of consensus on
29 REPORTERS’ STUDY, supra note 27, at 25 (“The court award is simply a symbolic

starting point for the allocation of financial responsibility that eventually works itself
out in the world beyond the courtroom.”).
30 REPORTER’S STUDY, supra note 26, at 25.
31 See Felix S. Cohen, Transcendental Nonsense and the Functional Approach,

35 COLUM. L. REV. 809, 809-12 (1935) (arguing that an inquiry seeking to determine a
corporation’s domicile is non-sensical); OLIVER WENDELL HOLMES, JR., THE COMMON
LAW 6-10 (1881) (arguing that respondeat superior derives from ancient law that
superstitiously attributed wrongs to inanimate objects).

13
moral norms or tenets.32 Moreover, as mentioned above, the
conduct about which modern plaintiffs tended to complain no
longer consisted of everyday bad acts, such as D intentionally
striking P, or stealing from, P. Rather, it consisted of the failure
of commercial enterprises adequately to take into account the
safety of employees, customers, and bystanders.33 For this sort
of conduct, there were no immediately applicable customary
norms. It was therefore no accident that the legal standard
increasingly employed by modern judges to gauge behavior -- the
standard of reasonable care -- was an objective one designed to
express what society demands of an actor, rather than to
measure the actor’s moral culpability. As the economy and
society modernized, objective negligence came to dominate tort,
and tort increasingly was taking the form of rulings based on
judges’ conceptions of the social desirability or undesirability of
particular forms of conduct.34
So if tort was no longer operating in accordance with the
description contained in the traditional account, what was it
doing? Here the historical claim of compensation-deterrence
theory merges into and supports its central functional
argument. In essence, the sleepy and moralistic department of
private law known as “tort” had transformed itself into an
energetic and important component of the emerging
administrative state. By empowering plaintiffs to commence
suits that would be litigated for the most part under the
objective reasonableness standard, the common law of tort had
come to delegate power to judges and juries to legislate on
matters of social policy. To speak anachronistically, tort law
had taken on the cast of an enabling statute such as the
Occupational Health and Safety Act, which creates an agency
(OSHA) charged with regulating conduct in aid of achieving a
policy goal (workplace safety). Tort suits thus ceased to be
“cases and controversies” adjudicated under law and became
instead occasions for judges and juries to regulate behavior on a

32 See John C. P. Goldberg, Style and Skepticism in The Path of the Law, 63
BROOK. L. REV. 225, 273-75 (1997) (noting Holmes’s skepticism about the existence of
moral wrongs).
33 Robert L. Rabin, Some Thoughts on the Ideology of Enterprise Liability

Theory, 55 MD. L. REV. 1190, 1196-97 (1996).

34 PROSSER, supra note 24, §1, at 8-9 (emphasizing that the legal standard of

fault is “socially undesirable” conduct).

14
forward-looking basis. In sum, tort had transformed itself from
private to “public” law, whereby it functioned to achieve
“collective,” not “corrective,” justice.35
But what sort of ‘agency’ was being formed by the corps of
judges and juries hearing tort cases? What was their regulatory
objective? Here, the answer is found by looking to the character
of the remedies that tort provides.36 If enabling statutes set
missions (“environmental protection,” “workplace safety”) that
specify the domain in which a given agency can or should
regulate, so the remedial powers granted to judges by the
common law sets the primary limit on the quasi-legislative
power conferred by tort. In doing so, it renders tort a distinctive
department of the law by identifying the function that it serves.
Judges and juries presiding over tort cases generally lack
the power to issue edicts and sanctions directed at the general
population and enforceable independently of future private
complaints. Their enactment of “legislation” must necessarily
consist of rulings affecting particular parties. Tort law further
restricts how a judge may act even toward the parties before it.
For example, it cannot (absent a finding of contempt) order the
defendant to jail. In fact, the court is limited to two basic
remedial options. Under certain circumstances, it can enjoin
behavior. More typically, however, it will issue an order
requiring the transfer of money from the defendant to the
plaintiff. Empirically, moreover, almost all tort cases end in
settlement by means of a cash payment.
Thus, if tort causes-of-action are what enable courts to
legislate, it is the compensatory remedy that confers on tort a
discrete set of policy objectives to which judges and juries do and
should attend. Indeed, the nature of the compensatory remedy
demonstrates that the ad hoc legislation undertaken within tort
cases is inherently capable of promoting only two goals:
deterrence of anti-social conduct and compensation for those

35 Rabin, supra note 33, at 1193 & n. 22; Leon Green, Tort Law Public Law in

Disguise (Parts I & II), 38 TEX. L. REV. 1, 257 (1959 & 1960).
36 Defining tort law’s mission in terms of remedy is consistent with the concept-

skepticism and empiricist leanings of compensation-deterrence theory. The only thing

‘real’ about tort law, from the perspective of compensation-deterrence theory, is the
authority or power it generates in judges and juries, as well as the material
consequences that can flow from exercises of that power – penalization of the
defendant and compensation of the plaintiff.

15
who have been injured. Because they have the power to order
defendants to pay damages, courts can in principle deter the
defendant and other similarly-situated actors from engaging in
conduct they deem undesirable, at least insofar as such threats
affect actors’ decisions, and insofar as the court can rely on
future courts to permit or impose sanctions on such actors.
Likewise, courts can compensate at least some injured persons.
Thus, the judges and juries who have been empowered by tort to
legislate by the commencement of actions under the common law
are in a position to accomplish two, and only two, things:
deterrence and compensation. And so we arrive at the baseline
proposition of compensation-deterrence theory, repeated at the
outset of countless law review articles published in the last fifty
years: the function of tort law is to compensate and deter.37
So now we have a macroscopic view of the interpretive
aspect of compensation-deterrence theory. Historically, it
advances the notion that tort law has moved from being an
institution for the adjudication of private wrongs to an
institution that empowers judges and juries to legislate for the
public good. Functionally, it suggests that the regulatory aims of
such adjudicative ‘legislation’ is to deter anti-social conduct and
compensate those injured by such conduct.

2. CONCEPTUALIZING DOCTRINE IN TERMS OF FUNCTION.

The bulk of interpretive analysis provided by
compensation-deterrence theorists consists of taking the
foregoing framework and applying it as a way of better
understanding tort doctrine. Once we see that tort law is really
regulation in aid of the ‘policy’ goals of compensation and
deterrence, its advocates reason, we can better make sense of
the direction and content of modern tort doctrine by reference to
that function. Tort law’s twin functions, in other words, are
what give ‘meaning’ to what otherwise would be empty doctrinal

37 Within compensation-deterrence theory there are disagreements as to whether

one or the other of these goals takes or ought to take precedence. Earlier theorists
like Prosser supposed that compensation was primary, deterrence secondary; later
theorists, including Schwartz, have reversed the ordering. Compare PROSSER, supra
note 24, §2, at 10, 28 with Gary T. Schwartz, Mixed Theories of Tort Law: Affirming
Both Deterrence and Corrective Justice, 75 TEX. L. REV. 1801, 1828 (1997) (tort law
primarily aims to deter, but will also compensate for injustices that it fails to deter).

16
rules and concepts, such as negligence law’s fault standard of
liability, or the requirements of “duty” and “proximate cause.”
For the most part, interpretive compensation-deterrence
theory has been concerned to trace out the final stages of the
historical transformation from pre-modern to modern law. In
particular, it has sought to record the elimination by judges of
the last vestiges of the traditional account of tort. This they
have done in two steps. The first, set in motion by Holmes, was
to establish negligence as the dominant tort and to move strict
liability, “intentional” torts, and other denominate torts (such as
nuisance and defamation) to the margins of the tort universe.
Tort, on this account, was becoming more or less synonymous
with negligence.38 Battery, assault and the like were relegated
to historical artifacts; strict liability confined to odd cases
involving wild animals and “ultrahazardous” activities, and so
forth.39
Second, they have sought to document how the modern law
of negligence has worked itself pure by shedding “arbitrary”
limitations left over from the days of pre-modern tort law,
limitations that still tended to masquerade as limits inherent in
the elements of “duty” and “proximate cause.” Along these lines,
compensation-deterrence theorists have lovingly charted
developments including: the abolition of the privity rule for
products liability claims; the elimination or modification of
sovereign, charitable and family immunities; the abandonment
of the status categories of plaintiffs in premises liability cases;
the removal of ‘arbitrary’ limits (such as the ‘impact’ and ‘zone of
danger’ rules) on claims for negligence causing emotional
distress and pure economic loss; the suppression of superseding
cause; and the shift from contributory to comparative fault.
Taken together, they argued, these changes evidenced a
relentless march toward a “full” regime of negligence, under

38 Oliver W. Holmes, The Path of the Law, 10 HARV. L. REV. 457, 471 (1897)
(attributing to tort law a general theory of liability in terms of failure to avoid causing
harms that should have been foreseen); PROSSER, supra note24, §1, at 8-9.
39 RESTATEMENT (THIRD) OF TORTS: LIABILITY FOR PHYSICAL HARM (BASIC

PRINCIPLES) (Tentative Draft No. 1 2001) (providing relatively brief treatment of

intentional torts and strict liability within a document that aims to restate the “basic
principles” of tort law as applied to physical harms).

17
which an actor is prima facie liable whenever s/he acts in an
unreasonable manner causing any harm to any person.40
In the view of compensation-deterrence theory, then, the
story of twentieth century tort law is the emergence of
negligence as ‘the’ modern tort, as well as the evolution of that
tort toward the pure “fault principle”41: a rule of prima facie
negligence liability unadorned by arbitrary limitations. In some
sense, this story had to be told: it was pre-ordained by the public
law nature of modern tort. Again, the only intelligible point of
modern tort law is to deter socially undesirable conduct and to
compensate persons injured as a result of that conduct.
Moreover, conduct is undesirable if it is “unreasonable” -- if, on
balance, it does society more harm than good.42 Finally, “harm”
is understood in a fact-of-the-matter sense: any loss counts as
harm, regardless of the form it takes. Hence the airtight fit
between compensation-deterrence theory and the pure fault
principle: precisely because the purpose of tort law is to deter
socially undesirable conduct and to compensate any actual
losses of welfare flowing from such conduct, and precisely
because conduct is socially undesirable when unreasonable, it
follows that, prima facie, whenever an actor’s unreasonable
conduct causes any harm, the actor should pay for the harm.
This way, the injured person is compensated by means of a
payment that, because it comes from the pocket of the anti-social
actor, will deter such acts in the future.
In the period from, say, 1920 to 1970, the idea that the law
was moving inexorably toward the full implementation of the
“fault principle” as the natural expression of the public essence
of modern tort law was regarded as a central strength of the
interpretive side of compensation-deterrence theory.
Awkwardly, however, the movement started to stall in the
1970s, and courts thereafter even seemed to lurch backward
toward tort’s moralistic past. So, for example, the “Rowland”
revolution – which, by abolishing the distinction among invitees,
licensees, and trespassers was to establish the pure fault

40 Gary T. Schwartz, The Beginning and the Possible End of the Rise of Modern

American Tort Law, 26 GA. L. REV. 601, 605-17 (1992) (charting these developments).
As I note below, however, some compensation theorists dissent from this analysis.
41 Robert L. Rabin, The Historical Development of the Fault Principle: A

Reinterpretation, 15 GA. L. REV. 925 (1981).

42 PROSSER, supra note 24, §4, at 21.

18
principle in the area of premises liability -- remained
incomplete, with many jurisdictions explicitly disowning it in
whole or in part.43 Likewise, the rules limiting liability for
negligence causing intangible economic loss remained
restrictive.44 And, after flirting with the idea of placing
emotional distress under the ambit of the fault principle, even
the California Supreme Court backtracked to a set of highly
formalized rules limiting the class of plaintiffs who might
recover.45
As a result of these late-Century developments,
contemporary compensation-deterrence theorists have been left
with an interpretive puzzle. If modern tort law is a system for
compensating and deterring, and, if the fault principle perfectly
implements that agenda, why do courts continue to adorn it with
exceptions through doctrines such as “limited duty” and
“proximate cause?” Here, compensation-deterrence theorists
have repaired to second-order explanations designed to patch
the theory in face of these recalcitrant features of the tort
system. In particular, they have posited that second-order
constraints of administrability, fairness, and legitimacy have
caused judges to depart from the pure dictates of the fault
principle.
Judges, as we have seen, must legislate in the context of
lawsuits, and there are only so many disputes that any given
judicial system can handle. Where the unencumbered operation
of the fault principle would invite a ‘flood’ of litigation – for
example, by inviting all those who suffer emotional distress at
the hands of another to sue -- courts may therefore be reluctant
to implement it, even if it would promote the goals of deterrence
and compensation. Likewise, judges need to be on the lookout
for feigned injuries and fraudulent suits. Under the jurisdiction
granted by tort, courts are supposed to regulate conduct that is
anti-social because it actually harms or threatens real harms to
others. Yet certain classes of claims -- particularly claims
alleging hard-to-verify emotional traumas -- may invite
unscrupulous litigants and attorneys falsely to claim harm. In
both of these situations, courts cabin the fault principle by

43 Schwartz, supra note 40, at 660.

44 Id. at 658.
45 Thing v. LaChusa, 771 P.2d 814 (Cal. 1984).

19
setting what are nominally cast as “duty” and “proximate-cause”
limits on the fault principle out of administrative concerns.46
One also finds reference to other second-order
considerations that, in the eyes of compensation-deterrence
theorists, support limitations on the fault principle. Some seem
to presume that judicial legislation is bounded by popular
(mis?)-conceptions that affect the legitimacy of the courts.
Lawyers ‘know’ that judges and juries legislate, but the people
at large apparently don’t. Thus, if judges and juries faced with
tort cases set about deterring and compensating in a manner
that departs markedly from prevailing notions of what judges
are supposed to do, they risk inviting recall elections or
legislative tort reform. In particular, to the extent there are
categories of decisions where legitimacy is likely to be lacking --
e.g., decisions as to whether a particular genus of product (e.g.
cigarettes) or a particular practice or activity (e.g. suburban
cocktail parties) is deserving of sanction -- courts may tend to
refrain from permitting juries to impose liability, if only to
protect themselves from political backlash.47 Other
compensation-deterrence theorists suggest that judges can also
bring a sense of fairness to their legislative enterprise. This
sense, for example, is displayed in judicial reluctance to apply
the fault principle in its full vigor on negligent actors who cause
intangible economic harm (e.g., accountant malpractice causing
losses to investors, or negligent operation of a vehicle resulting
in a blocked highway or harbor and consequent reduced
economic activity in the area): the economic ripple-effects of
misconduct threaten to generate liability vastly out of proportion
to the degree to which the defendant’s conduct is anti-social.48

B. PRESCRIPTIVE COMPENSATION-DETERRENCE THEORY.

Some compensation-deterrence theorists disavow
prescriptive analysis altogether. Those that do not have mainly
46 PROSSER, supra note 24, §34, at 212 (noting that the “only valid” argument for

limiting liability for emotional distress is one of fraud or floodgates).

47 James A. Henderson, Jr., Expanding the Negligence Concept: Retreat from the

Rule of Law, 51 IND. L.J. 467, 470 (1976) (noting that judicial system is threatened
when judges overtly make open-ended policy decisions).
48 Robert L. Rabin, Tort Recovery for Negligently Inflicted Economic Loss: A

Reassessment, 37 STAN. L. REV. 1513, 1534 (1985); Rabin, supra note 33, at 1205-06
(noting continued role of justice norms as a constraint on the application of the fault
principle).

20
sought to determine the degree to which the primary side-
constraint of administrability, discussed above, not only does
limit the operation of the fault principle, but ought to limit it.
For example, some within the camp have debated whether the
constraint justifies the courts’ continued adherence to the notion
that special, limited-duty rules ought to apply to negligence
causing intangible economic loss. Here, the concern about
economic ripple effects has led most compensation-deterrence
theorists to advocate one form or another of limited liability,
such as recovery only by those in privity, or near privity, with
the actor.49
Some dissident prescriptive theorists within the
compensation-deterrence camp have, however, taken on the
more ambitious project of challenging the centrality of both
negligence and the fault principle to compensation-deterrence
theory. Specifically, these critics have questioned whether the
fault standard, and the requirement contained within the fault
principle that the plaintiff prove a causal link between her
injury and the defendant’s misconduct, are actually useful tools
in the effort to achieve deterrence and compensation.
With respect to the fault standard, the dissidents have
suggested that the “reasonable person” test for what counts as
fault is so malleable as to introduce undesirable arbitrariness in
determining the conduct that is to be deterred and the injuries
that are to be compensated. In light of this problem, they
suggest that the jury determination of fault must be constrained
by judicial as-a-matter-of-law rulings under the headings of duty
or proximate cause.50 Other critics suggest that courts would do
better to choose between strict liability rules on the one hand
(perhaps in conjunction with techniques for reducing disparities
in jury damage awards), and no-liability rules (first party
insurance) on the other.51
Similarly, some compensation-deterrence theorists have
argued that the fault principle’s causation requirement often
will operate disfunctionally with respect to the goals of

49 John C. Siliciano, Negligent Accounting and the Limits of Instrumental Tort

Reform, 86 MICH. L. REV. 1929, 1974 (1988).

50 Henderson, supra note 47, at 526 (urging courts to adhere to formal doctrinal

limits on liability for negligence).

51 Kenneth S. Abraham, The Trouble with Negligence, 54 VAND. L. REV. 1187,

1189 (2001).

21
compensation and deterrence. Actual causation, they point out,
has no inherent functional link to the goals of deterring anti-
social conduct, nor to compensating injured persons. For
example, suppose D drives carelessly down First Avenue
without incident. Five blocks away, P, through no fault of her
own, breaks her ankle stepping off a curb. If it makes sense for
an agency such as OSHA to regulate to lessen the risk of injuries
prior to their occurrence, why shouldn’t judges and juries
legislate in a like fashion by sanctioning D’s unreasonably risky
driving even though it happened in this case not to cause any
injury? Likewise, if P can prove that she has in fact suffered an
injury for which she needs compensation, and further can prove
that D has engaged in anti-social conduct, why should it matter
that D’s conduct did not cause her injury? A tort suit that
results in D paying P will, after all, achieve the twin goals of
deterrence and compensation.
Thus, according to the dissidents within compensation
deterrence theory, the causation component of the fault principle
is not actually required by the policy goals of deterrence and
compensation. Worse, it actually operates at times to defeat the
attainment of these goals, as for example, in cases where an
actor repeatedly engages in undesirable conduct that creates
only small increments of risks of harm to plaintiffs. Consider,
for example, a shipping-line owner who instructs the captains in
his employ never to make any attempt to rescue overboard
sailors. Suppose the blanket policy against rescue efforts is
unreasonable, yet, with respect to any given overboard sailor,
the likelihood of actual rescue resulting from reasonable rescue
efforts is 1%. It follows that no plaintiff suing for the death of
an unrescued sailor can prevail, since, for each, it is more likely
than not that the rescue would have failed. Hence antisocial
conduct goes undeterred, its victims uncompensated.
The best argument for requiring proof of causation, on the
dissenters’ view, turns out to be a second-order reason of
administrability. Without actual injuries in front of them,
judges simply won’t be in a position to know who was actually
put at how much risk by a defendant’s anti-social conduct, nor
how to set sanctions for the misconduct.52 Yet, given this

52 KENNETH S. ABRAHAM, THE FORMS AND FUNCTIONS OF TORT LAW 102-05 (2d ed.
2002).

22
particular defense of causation, it would seem to follow that,
when administrative problems can be overcome, the proof
requirement ought to be relaxed. For example, consider the
“loss-of-chance” cases, in which a physician negligently fails to
diagnose a patient’s disease so as to reduce the patient’s chance
of recovery from, say, 40 to 10 percent. If the patient dies, and
the complaint is understood as asserting a claim of wrongful
death based on malpractice, then the plaintiff stands to lose
because he cannot meet his burden of proving that the
malpractice was a but-for cause of his death -- he likely would
have died anyway. To the compensation-deterrence theorist, the
rule requiring the plaintiff to prove causation here frustrates the
goals of deterrence and compensation, because it allows
negligent conduct to go completely undeterred and an injury -- a
lost opportunity for survival -- to go uncompensated. Moreover,
in this limited class of cases, concerns for administrability or
proportionality can be satisfactorily met by a rule less stringent
than the per se rule against recovery. Thus, these plaintiffs
should be awarded pro rata damages, under which the plaintiff
receives a percentage of all the compensable losses associated
with her death that corresponds to the decrease in her chance of
recovery resulting from the physician’s negligence (e.g., 30
percent of wrongful death damages, in the foregoing
hypothetical).53

C. CRITICISMS OF COMPENSATION-DETERRENCE THEORY.

Although, as just indicated, particular applications of
compensation-deterrence theory have been scrutinized and
challenged by scholars within the camp itself, relatively little
attention has been paid to the broader underpinnings of the
theory.
Interpretive compensation-deterrence theory commences,
as we have seen, with the claim that the traditional account is
obviously inapplicable to modern tort litigation. The arguments
it musters in support of this contention, however, tend to be
conclusory, tendentious, and probably inconsistent with the

53 See, e.g., Aaron Twerski & Anthony J. Sebok, Liability without Cause?
Further Ruminations on Cause-in-Fact as Applied to Handgun Liability, 32 CONN. L.
REV. 1379, 1388-1403 (2000) (arguing for pro rata recovery by victims of shootings
suing gun manufacturers for negligently increasing the risk of their being shot).

23
theory’s embrace of deterrence as one of tort law’s two objectives.
For example, suppose it is the case that the owners of insurers
and other corporations are the ones who pay tort judgments. It
hardly follows that the entry of judgment against them has no
significance for the individual actor(s) who engaged in the
misconduct. Formal arrangements such as experience-rating
and indemnification contracts, as well as informal sanctions,
such as loss of employment and reputation, ensure that in many
instances, some or all of the costs associated with a tort verdict
are incurred by the actual tortfeasor. Indeed, if this were not
the case, then the notion that tort law can deter anti-social
conduct -- a bedrock proposition of compensation-deterrence
theory -- would seem equally false.
Likewise, it is hardly obvious that a medical malpractice
plaintiff who collects his judgment from a physician’s insurer,
rather than the physician himself, has somehow been denied the
ability to assert that the doctor wrongfully injured him. To be
sure, the contractual relationship between physician and insurer
shifts the burden of payment onto the insurer. In no sense,
however, does it shift or void the judgment of responsibility cast
on the physician. Indeed, that is the very trigger of the insurer’s
obligation to pay. Similarly, the argument that responsibility
for actions cannot, except in a fictional sense, be attributed to
incorporeal entities rests on an undefended postulate that
ascriptions of intentions, purposes, carelessness, and the like
can only be assigned to individual natural persons. This
postulate is not self-evident, nor even especially intuitive. To
the contrary, as Judge Friendly famously noted, it is quite
common to attribute acts, mental states, and responsibilities to
entities such as corporations and governments.54
Moreover, notwithstanding its dismissal of the classical
account, compensation-deterrence theory garners some of its
interpretive plausibility by illicitly trading on a key feature of
that account. Typically, when compensation-deterrence
theorists refer to the goal of “compensation,” they do not mean
“receipt by the injured plaintiff of money in recognition of her

54 Ira S. Bushey & Sons, Inc. v. United States, 398 F.2d 167, 171 (2d Cir. 1968)
(asserting that respondeat superior invokes a “deeply rooted sentiment that a
business enterprise cannot justly disclaim responsibility for accidents which may
fairly be said to be characteristic of its activities”) (emphasis added).

24
injuries.” Rather, they mean “compensation paid by the
defendant to the plaintiff in recognition of her injuries.” This
latter usage permits compensation-deterrence theorists quietly
to retain a critical and intuitive feature of the classical account
of tort, namely, the idea that, as they go about their
policymaking, judges may do so only by eliciting a payment from
a defendant whose conduct has some connection to the plaintiff’s
injury. Yet, as some prescriptive compensation-deterrence
theorists have noted, it is not obvious that compensation-
deterrence theory provides any reason as to why courts ought to
adopt as a general rule that unreasonable conduct will only be
deterred, and injuries only compensated, when the injury being
sued upon is one that has been caused by the defendant’s
unreasonable conduct.55 By and large, interpretive
compensation-deterrence theorists rely on the semantic
ambiguity of “compensation” to avoid confronting this problem.
Other aspects of compensation-deterrence theory’s
narrative are suspect. As we have seen, since Holmes, its
adherents have pointed to modern negligence law’s adoption of
the “objective” fault standard – which refuses, in some ways, to
take into account the individual defendant’s inability to meet
the standard – as an important sign of the demise of the
traditional account and its claim that tort is about redressing
wrongful conduct. This argument is both anachronistic and, at a
minimum, underdeveloped. Use of the objective standard traces
at least back to the 1837 decision of Vaughn v. Menlove,56 and
likely centuries further back than that, to judicial employment
of the customs and standards of particular trades and
professions as a measure of conduct in suits grounded in
assumpsit or trespass on the case.57 In short, there is nothing
particularly ‘modern’ about the objective standard; it was
already a feature of traditional tort law. This historical fact also
points towards a conceptual rejoinder to the Holmesian
argument. Holmes simply presumed that a standard of conduct
cannot be a moral standard if it attaches liability to conduct for
which the actor may not personally be blamed. He presumed
this because he equated acting wrongfully with acting in a

55 See supra text accompanying notes Error! Bookmark not defined.-53.

56 132 Eng. Rep. 490 (C. P. 1837).
57 A. K. KIRALFY, THE ACTION ON THE CASE 138 (1951).

25
personally blameworthy fashion.58 However, that association is
by no means an obvious one. Indeed, a number of scholars have
proposed accounts of wrongdoing under which it is quite
intelligible to say of a person that s/he acted wrongfully, even if
she was not particularly blameworthy for so acting.59
In retrospect, it is apparent that compensation-deterrence
theory is heavily reliant on the moral-, law- and concept-
skepticism that was very much in vogue among American legal
scholars in the first half of the twentieth century. While it
would take us far afield to assess the validity of these skeptical
theories, one can at least respond by noting that what may have
seemed in 1890 or 1930 to be compelling proofs of the emptiness
of moral and legal concepts are not widely regarded as carrying
much weight today.60 At a minimum, one can safely assert that
compensation-deterrence theorists have not done the
philosophical work necessary to obtain “summary judgment”
against accounts of tort law that invoke those concepts.61
Compensation-deterrence theory’s account of modern tort
doctrine, which posits the main story of twentieth-century tort
to be the more-or-less relentless march of the fault principle, is
also open to dispute. Take, for example, the abolition of the
privity rule by decisions such as MacPherson v. Buick.62 The
compensation-deterrence account equates the abolition of the
“limited-duty” rule of privity with recognition of the pure fault
principle in the area of products liability. Yet this is not the
account that Cardozo gives in MacPherson itself, nor is it the
account that best makes sense of that doctrinal transition and
its relation to other transitions in modern negligence law. The
New York Court of Appeals concluded that Buick owed
compensation to MacPherson not because it assumed that actors
must pay whenever they act unreasonably so as to cause any
harm, but because it understood the manufacturer-consumer

58 Goldberg, supra note 32, at 273.

59JULES L. COLEMAN, RISKS AND WRONGS 329-60 (1992); ARTHUR RIPSTEIN,
EQUALITY, RESPONSIBILITY AND THE LAW 84-85 (1999).
60 Goldberg & Zipursky, supra note 16, at 1802-06.
61 John C. P. Goldberg, The Life of the Law, 51 STAN. L. REV. 1419, 1475 (1991)

(reviewing ANDREW L. KAUFMAN, CARDOZO (1998)) (noting the ironic tendency of

modern scholars to treat Holmes’s ‘life of the law’ epigram as if it established an
eternal verity).
62 111 N. E. 1050 (N. Y. 1916).

26
relationship to be one that creates a duty on the manufacturer
to be vigilant of harm it might cause to users of its products.63
More generally, compensation-deterrence theory’s attempt
to explain all of the ins-and-outs of negligence doctrine in terms
of only two sorts of variables – the fault principle, tempered by
second-order reasons of administrability, legitimacy, and
fairness -- is reductionist, highly manipulable, and therefore of
doubtful explanatory value. The abstract idea of
“administrability” – for which no criteria have been developed –
can just as readily support decisions to limit or not limit
particular forms of negligence liability. Even if rendered
adequately determinate, it often seems unable to explain limits
on negligence liability. For example, the explanation of the
limited scope of liability for negligence causing emotional
distress in terms of a concern to avoid a vast number of
‘fraudulent’ suits seems quite unconvincing.64 The same goes for
explanations invoking other second-order limits on negligence
liability. Consider Professor Rabin’s explanation of the limited
duties owed to take care not to cause intangible economic loss to
others. Those limits on the fault principle, he suggests, arise
from “a deep [judicial] abhorrence to the notion of
disproportionate penalties ….”65 What’s missing is an account of
why the same judicial concern and the same rule of
proportionate liability does not arise in other areas of
negligence. Here I have in mind not just the ‘thin skull’ cases, in
which defendants are made to pay large damage awards because
of a hidden vulnerability in the plaintiff, but any case in which
widespread or substantial damage flows from a minor lapse on
the part of the defendant, or perhaps – given a particular
defendant’s inability to meet the objective standard – no
blameworthy wrong at all.66 Why does the judicial concern for
“proportionality” seem to address only the ripple-effect version of
disproportionality, as opposed to to these other forms?
63 Goldberg & Zipursky, supra note 16, at 1812-25; John C. P. Goldberg &

Benjamin C. Zipursky, The Restatement (Third) and the Place of Duty in Negligence
Law, 54 VAND. L. REV. 657, 664-74 (2001).
64 John C. P. Goldberg & Benjamin C. Zipursky, Unrealized Torts ___ Va. L. Rev.

___ (forthcoming 2002).

65 Rabin, supra note 48, at 1534.
66Jeremy Waldron, Moments of Carelessness and Massive Loss, in
PHILOSOPHICAL FOUNDATIONS OF TORT LAW 387, 387-89 (David G. Owen, ed., 1995)
(noting tort law’s willingness to impose disproportionate liability).

27
 The two-tiered structure of interpretive compensation-
deterrence theory -- the fault principle as default rule, tempered
by second-order considerations such as administrability --
arguably also fails to capture the contours and ‘texture’ of tort
doctrine. For example, since the time of Prosser, it is standard
for compensation-deterrence theorists to state that what is
“really” going on in so-called “limited duty” cases (e.g.,
negligence causing emotional distress, or careless failures to
rescue) is that judges are containing the normal operation of the
fault principle out of concern not to reward feigned injuries or
not to provoke excessive litigation or liability. Even if these sorts
of policy reasons partly undergird the doctrinal rules that
determine whether or not a duty was owed, it does not follow
that a judge’s ruling on a duty issue is properly paraphrased as
stating that, unless there are special problems of
administrability, liability will attach. Under this formulation,
the defendant is presumed to have been obligated to take care
not to injure the plaintiff, but might yet benefit from a reprieve
if it turns out that it is too difficult for the judicial system to
hold him to that duty. Yet courts often, probably typically, do
not inquire under the heading of duty whether practical
necessities demand that the court bestow on a negligent
defendant the windfall of a policy-driven exemption from
liability. Instead, they inquire whether the defendant was
obligated in the first place to take care not to injure the plaintiff.
The difference is subtle but important: the issue of whether to
recognize an obligation to take care with respect to the plaintiff
frames a very different question than the issue of whether to
grant an exemption from liability. The former focuses attention
on how the defendant was supposed to conduct himself with
respect to certain other persons. The latter asks courts to
speculate as to the systemic effects of permitting negligence
liability to attach to conduct of the sort engaged in by the
defendant.67
On the prescriptive level, those compensation-deterrence
theorists who have embraced fault as a general standard of
liability have offered remarkably little by way of justification.
Indeed, for all the attention they have devoted to negligence,
they have said very little about why they regard it as striking
67 Goldberg & Zipursky, supra note 63, at 720-36 (elaborating on this point).

28
the right mix of deterrence and compensation. Modern economic
theory, discussed below, suggests that, from a deterrence
perspective, there is often no difference between strict liability
and negligence: both standards will tend to cause rational actors
subject to liability to take only those precautions that are
cheaper than the sanction itself.68 Moreover, strict liability
promises in principle to provide more consistent compensation to
the injured. So why is it not the default rule? Most
compensation-deterrence theorists at this point become
curiously complacent, content to note that fault has long been
the general rule that courts have endorsed for unintentional
harms. 69 Alternatively, they suggest that strict liability will
“overdeter”: i.e., too greatly suppress desirable activities.
The first response not only begs the question, it seems
actually to undermine the intelligibility of the fault standard
because it suggests that fault is nothing more than a historical
hangover from the pre-modern era, when courts thought that
their job in tort cases was to do justice between the parties.70
Needless to say, this explanation tells us nothing about why
modern courts ought to continue to fasten on fault. The second
response merely reiterates Holmes’s unhelpful proposition that
“action … tends to the public good.”71 What we need to know,
from this theoretical perspective, is whether the trade-off in
suppression of activity is worth the costs saved.
Another complaint about prescriptive compensation-
deterrence theory is that it is highly unstable and somewhat
self-serving. In rejecting the traditional account, the theory
largely dispenses with law, understood as a body of principles,
rules and concepts distinct from whatever functions those
principles, rules and concepts are designed to serve. Yet
compensation-deterrence theory does not attempt to fill the
vacuum created by its dismissal of legal reasoning with any
particular mode of analysis. Instead, it treats each case lacking
an obvious resolution as presenting a clean slate inviting all-
things-considered legislative evaluations as to whether to
sanction the particular conduct in question. This is in part

68 See infra text accompanying notes 112-15.

69 Schwartz, supra note 40, at 607.
70 Id.; REPORTERS’ STUDY, supra note 27, at 29.
71 HOLMES, supra note 31, at 95.

29
because, notwithstanding their disavowal of traditional legal
analysis, compensation-deterrence theorists are usually highly-
skilled lawyers whose competence resides in parsing case law
and rendering lawyerly judgments about issues of responsibility
-- as opposed, say, to modeling or obtaining empirical
information about the incentive effects of particular case
outcomes. As a result, their analyses of how cases ought to come
out tend to take the form of ‘soft’ policy; rough-and-ready
suggestions about which particular outcome is likely best to
promote deterrence and/or compensation without sacrificing
administrability. These efforts at amateur policymaking have in
turn engendered the impression (shared by many students,
lawyers, and professors) that there is no “there” there in tort law
or scholarship, merely undisciplined judgments of
“reasonableness” and ad hoc “balancing” of policy factors.72 It
might also garner the suspicion that compensation-deterrence
theory, in positing the judge as amateur legislator and
regulator, has been set up in a way that maximizes the potential
influence of those law professors who stand ready to serve as
unappointed policy advisors to the judge-legislator.73
Most fundamentally, in its prescriptive aspect,
compensation-deterrence theory raises a basic issue as to the
legitimacy of the common law of torts. In other areas, such as
constitutional law, the recognition of the supposed fact of
unbridled judicial discretion, has been offered as part of a
powerful argument against judicial activism, and in favor of
legislative and agency supremacy vis-a-vis the courts. It is true
that judicial lawmaking in torts, to the extent correctable by
legislation, does not face exactly the same counter-majoritarian
objection. Yet it is not at all obvious that compensation-
deterrence theory provides any affirmative reasons to lodge
lawmaking responsibility in judges. In other words, the logical
endpoint of compensation-deterrence theory may not be the
brave new world of anti-formalist common law adjudication
imagined by Prosser, in which judges forthrightly engage in
“social engineering.”74 Rather, it might instead be the ascendant

72Goldberg & Zipursky, supra note 63, at 735.

73 Goldberg, supra note 19, at __ (noting Prosser’s insuation that he shared the
power to make tort law with judges).
74 PROSSER, supra note 24, §3, at 15.

30
American law of legislative tort reform and regulatory
preemption, in which the social engineering is undertaken by
actors who are, at least in theory, more politically responsive.
By taking the law out of tort law, and reducing tort cases to
instances of legislation, compensation-deterrence theorists may
have ceded their chosen subject to the “man of statistics and the
master of economics.”75

III. ENTERPRISE LIABILITY THEORY

A successful tort action typically results in payment by an
insured or corporate actor to an injured victim. Thus, tort law,
like insurance, has the potential to transform a burden that
would be crushing if borne by one individual or family into a
relatively small cost borne by many. However, it can only
spread the losses of those victims who are able to find a
competent lawyer, willing to endure a lawsuit, potentially
capable of proving their cases to the satisfaction of judge and
jury, and ‘lucky’ enough to have been victimized by a solvent
defendant. Moreover, the tort system is set up in such a way
that those few plaintiffs who do manage successfully to run the
litigation gauntlet are rewarded not just with need-based relief,
but with super-compensatory awards padded with pain and
suffering -- and sometimes punitive -- damages.
These observations about the potential merits, and serious
drawbacks, of the tort system as a device for delivering need-
based relief set the basic dynamic of the enterprise liability
theory of tort, which maintains a critical yet somewhat
ambivalent disposition toward its subject. Enterprise liability
theorists have mainly sought to establish that existing tort law
is supremely ill-designed for delivering relief to accident victims.
Yet many of its theorists are prepared -- at least in the absence
of popular or political will favoring substitute compensation
schemes -- to encourage judges to reform tort law to expand
liability so as to enable the judiciary to function more
satisfactorily as a relief agency. Among the theory’s most
important modern proponents have been Patrick Atiyah, Albert
Ehrenzweig, Marc Franklin, Charles Gregory, Fleming James,
Jr., Robert Keeton, Jeffrey O’Connell, Virginia Nolan and
Edmund Ursin.
75 HOLMES, supra note 38, at 469.

31
 A. INTERPRETIVE ENTERPRISE LIABILITY THEORY
The interpretive claims of enterprise liability theory
combine Progressive politics and jurisprudential ‘anti-formalism’
with a particular hypothesis about the nature of accidents in the
industrial economy. Appalled by the human toll of
industrialization, Progressives tended to conceive of tort law –
particularly negligence law and its “unholy trinity” of plaintiff-
conduct defenses (contributory negligence, fellow servant rule,
and assumption of risk) -- as reflecting the worst excesses of
laissez-faire. That the American polity continued to rely on the
ancient, moralistic mechanism of tort law to respond to
accidents, even as the European countries had begun to develop
‘rational’, statistically-based systems of regulation and/or public
assistance, served only to demonstrate that, in this country,
liberal capitalism had run amok. Emblematic of this
interpretation of negligence law is the influential historical
speculation of Charles Gregory -- later pushed to its logical
extreme by Morton Horwitz -- that the tort of negligence was
invented, either consciously or unconsciously, to serve the
interests of capital.76 On this view, the initial decision of
nineteenth-century judges to recognize negligence as a
freestanding tort marked a departure from a historic baseline of
general strict liability for accidentally caused injuries. In this
way, negligence has from its inception acted as a systemic
subsidy for industry at the expense of workers and their
families.
Enterprise liability, having emerged roughly
contemporaneously with compensation-deterrence theory,
shares in the latter’s moral- and concept-skepticism. Thus, its
adherents also attacked traditional doctrinal reasoning as mere
form; an empty ritual without content of its own. Contrary to
compensation-deterrence theory, however, enterprise liability
theorists were less sanguine about the prospect of judicial
legislation under the guise of negligence. At worst, the
terminology of “duty,” “proximate cause” and “contributory
negligence” would continue to provide a verbal smokescreen by

76 MORTON HORWITZ, THE TRANSFORMATION OF AMERICAN LAW: 1780-1860 85-99

(1977); Charles O. Gregory, Trespass to Negligence to Absolute Liability, 37 VA. L.

REV. 359, 361-70 (1951).

32
which judges sympathetic to industry would use the language of
justice and law to disguise their efforts to protect corporate
earnings at the expense of ordinary citizens. At best, it caused
judges to seek to solve the ‘real’ social and political problem of
administering relief by means of a chimerical inquiry into the
meaning of these meaningless concepts. Given the emptiness of
legal inquiry, it was inevitable that a negligence regime would
either reproduce the dominant political biases of judges, or
function arbitrarily with respect to the provision of
compensation. Hence, the enterprise liability theorist’s constant
disparagement of the “negligence lottery” and its “feast or
famine” system of relief, in which only a small percentage of
sympathetic and lucky victims are overcompensated by jury
awards of damages in excess of need, while many victims go
without any compensation whatsoever.77
The inaptness of negligence law to the modern world is
further confirmed by an empirical supposition shared by many
enterprise-liability theorists that the torts worth caring about in
the industrialized economy will take a certain form.
Specifically, they suppose that modern torts will consist of
accidents displaying three essential attributes: (i) injuries
resulting from predictable but unpreventable ‘lapses’
accompanying large-scale, repetitive conduct; (ii) claims by
persons lacking the means to cover out-of-pocket costs and lost
wages; (iii) defendants with the ability to spread losses through
liability insurance or self-insurance.78 Historically, the first
exemplar of this paradigm case was, of course, the workplace
accident generating a suit by the injured wage-laborer (or his
estate) against his employer. By mid-century, a second
exemplar would join it on center stage: injuries caused by a
mass-produced product giving rise to suits by consumers against
a corporate manufacturer. According to enterprise liability
theory, once it is understood that these sorts of lapse-based
incidents will constitute the predominant form of accident in the
modern world, then the absurdity of attempting to respond to
them via the negligence system becomes all the more apparent.

77PATRICK ATIYAH, THE DAMAGES LOTTERY 143-50 (1997); STEPHEN D. SUGARMAN,

DOING AWAY WITH PERSONAL INJURY LAW 35-40 (1989).
78 John C. P. Goldberg, Misconduct, Misfortune and Just Compensation:

Weinstein on Torts, 97 COLUM. L. REV. 2034, 2045-47 (1997).

33
The whole point of negligence is to undertake an individualized
inquiry into whether an accident can be attributed to a
particular person acting at fault. As such it is utterly ill-suited
to inevitabilities such as workplace or product-related injuries.

B. PRESCRIPTIVE ENTERPRISE LIABILITY THEORY

In light of this strongly critical interpretive account of
negligence law’s origins and function, it is hardly surprising to
find that, as a prescriptive matter, many enterprise-liability
theorists have advocated the replacement of tort and negligence
with first- and third-party insurance schemes. Some advocate
the complete abolition of tort law in favor of a New Zealand-style
social insurance scheme for accidental injuries.79 Others have
proposed area-specific schemes on the model of worker’s
compensation. Still others suggest hybrid schemes, as found in
most American states’ automobile no-fault plans, which combine
basic compensation for medical expenses and lost wages through
mandatory insurance, with the right of the injured to bring tort
suits for more serious accidents or injuries.80
As noted earlier, however, it would be wrong to suggest
that enterprise-liability theorists have completely given up on
tort law. Indeed, many have written with a judicial audience in
mind in the hope of promoting developments within tort law
that would permit it to at least approximate the ideal of reliable,
need-based relief. Scholars writing in the period from 1950-
1970, for example, advocated and applauded as a second-best
solution the judicial adoption of strict products liability, the
elimination of restrictive ‘no duty’ rules and traditional
immunities in negligence, the expansion of joint and several
liability, and the development of market share liability as
important steps toward the goal of reliable compensation.81 The
goal was to have judges reform the tort system so that the cost
of statistically predictable accidents would be borne in the first
instance by the employer or product-manufacturer – the

79 Marc Franklin, Replacing the Negligence Lottery: Compensation and Selective

Reimbursement, 53 Va. L. Rev. 774 (1967).

80 WALTER J. BLUM & HARRY KALVEN, JR., PUBLIC LAW PERSPECTIVES ON A
PRIVATE LAW PROBLEM: AUTO COMPENSATION PLANS 3-8 (1965) (describing plans).
81 Fleming James, Jr., Tort Law in Midstream: Its Challenge to the Judicial

Process, 8 BUFF. L. REV. 315, 334-37 (1959).

34
“enterprises” in enterprise liability – and then passed onto the
consuming public.
More recently, theorists focusing on the American litigation
system have emphasized the promise of class actions for
permitting judges to create self-contained compensation schemes
for the victims of mass torts. Indeed, precisely because mass
tort suits aim to deliver ‘retail’ justice -- whereby the costs and
delays of repetitive litigation are reduced through the class
action device, the resolution of individualized issues such as
causation and damages is elided through settlements, and
damages are provided on a scheduled rather than “make-whole”
basis -- mass tort law holds greater promise of fulfilling through
judicial action the aspirations of enterprise liability theory than
any prior doctrinal development.82

C. CRITICISMS OF ENTERPRISE LIABILITY THEORY.

Although American jurisdictions have not embraced the
abolition of tort for a pure administrative scheme of
compensation, enterprise liability theory has had a substantial
impact on tort law, particularly in the second and third quarters
of the Twentieth Century, which saw the adoption of strict
products liability and automobile no-fault insurance schemes.
In recent years, however, the movement has lost a good deal of
its momentum.83 This reflects in part a changing political
climate in which calls for redistribution of losses through law
are treated more skeptically than they were in the period
running from, say, the time of the New Deal to that of the Great
Society program.84 It also reflects the fact that enterprise
liability theory has come in for substantial criticism.

82 Goldberg, supra note 78, at 2050-59.

83 This is not to suggest that enterprise liability theory has no modern adherents.
See VIRGINIA E. NOLAN & EDMUND URSIN, UNDERSTANDING ENTERPRISE LIABILITY: RE-
THINKING TORT REFORM FOR THE TWENTY-FIRST CENTURY (1995). Nor is it to say the
movement has lost all influence. See supra text accompanying note 80; see also
Rabin, supra note 33, at 1197-98 (noting that enterprise liability’s main continuing
influence is in judges’ willingness to entertain redistributive arguments in negligence
and product liability cases). Nor is it to deny that others have sought to defend some
of the hallmark conclusions of enterprise liability on alternative grounds. See infra
notes 97, 165.
84 G. Edward White, The Unexpected Persistence of Negligence, 54 VAND. L. REV.

1337, 1361-64 (2001).

35
 Despite its remarkable fifty-year run as perhaps the
standard historical account of modern tort law, the subsidy
thesis -- and the more general proposition that negligence was
born under a politically regressive star -- has been sorely tested.
Some have concluded that nineteenth-century judicial decisions
and opinions simply do not reveal a pro-industry or pro-
defendant pattern.85 Others have raised doubts that any
transformation from pre-nineteenth century to late-nineteenth
century tort law can be characterized as a simple shift
disfavoring compensation of the injured. First, it is not at all
clear that the pre-nineteenth century baseline was true strict
liability, i.e., liability for any injury factually caused by an
actor’s conduct, without consideration of the actor’s fault. While
early tort law appears not to have required plaintiffs formally to
plead fault as a basis for liability, it also seems likely that
judges nonetheless incorporated a notion of fault into the law
through doctrines such as “inevitable accident,” and that juries
were at least permitted to considered fault in rendering their
verdicts.86
Second, even if liability was at one time strict, the universe
of potential responsible actors under a tort law that
conceptualized and therefore determined liability almost
entirely through the language of causation was considerably
smaller than it would become under the law of negligence. In
particular, many actors enjoyed immunity from tort liability
because of the unwillingness of courts to consider responsibility
for participating in complex causal chains leading to injuries.
For example, courts overwhelmingly tended to treat acts of
persons other than the defendant -- including the acts of third-
parties and the plaintiff himself -- as “superseding” causes that
functioned to break the causal sequence commencing with the
defendant’s act, thereby freeing defendants who causally
contributed to injuries from any responsibility.87 In this regard,

85 JAMES W. ELY, JR., RAILROADS & AMERICAN LAW 211-12 (2001); PETER

KARSTEN, HEART VERSUS HEAD: JUDGE-MADE LAW IN LATE NINETEENTH CENTURY

AMERICA (1997); Gary T. Schwartz, Tort Law and the Economy in Nineteenth-Century
America: A Reinterpretation, 90 YALE L.J. 1717 (1981).
86 J. H. BAKER, AN INTRODUCTION TO LEGAL HISTORY 93-94 (3d ed. 1990); Stephen

Gilles, Inevitable Accident in Classical English Tort Law, 43 EMORY L.J. 575, 576
(1994).
87 Gary T. Schwartz, Weaver v. Ward, 74 TEX. L. REV. 1271, 1274-75 (1996).

36
the shift to a negligence model of accident law may have actually
conferred an important benefit on potential plaintiffs by clearly
separating the normative question of responsibility (duty and
breach) from the more-or-less factual question of causation.88 In
so doing, the negligence framework arguably empowered
plaintiffs to bring suit, by permitting them to frame their claims
in terms of a forthright request for judicial recognition of new
duties of care (rather than an argument about the proper
understanding of concepts such as “remote” and “proximate”
cause), thus suppressing judicial reliance on the doctrine of
superceding cause. Perhaps the most prominent manifestation
of this shift was the critical recasting of contributory negligence
from an absolute, superseding-cause concept to a mitigating
factor that apportions responsibility rather than destroying the
plaintiff’s cause of action.89
Enterprise-liability theorists’ critique of negligence as a
compensation lottery is also vulnerable to counter-attack. It is
one thing to acknowledge the high priority that ought to be
accorded to claims to need-based relief made by innocent
accident victims. Likewise, it is hard to argue with the
proposition that, traditionally, tort law requires the invocation
of too much machinery to be an efficient mechanism for
dispensing such relief. Still, these two observations of
themselves do not suffice to support the condemnation of the
negligence system as arbitrary. At most, they establish a
conditional proposition of the following sort: if the only metric
against which to measure the worth of negligence law is its
ability to provide disaster relief to accident victims, then
negligence law is highly problematic. What’s missing is an
argument as to why one might suppose that the provision of
disaster relief is the only metric by which to measure the value
of negligence.
For example, on the traditional account, tort law’s point is
not to provide disaster relief, but to empower private citizens to
seek redress for wrongs done to them by others. It may be, on
this view, that such relief is sometimes achieved by virtue of the

88 M. J. PRICHARD, SCOTT V. SHEPHERD (1773) AND THE EMERGENCE OF THE TORT

OF NEGLIGENCE 33 (1976).
89 See, e.g., Smith v. Smith, 19 Mass. 621, 623 (1824) (conceiving of contributory

negligence as a superseding cause doctrine).

37
compensatory payment from a tort defendant to a plaintiff, but
that is an incidental effect of the tort system, not its primary
purpose. Still, proponents of this view need not deny the
urgency of claims by accident victims to relief. Rather, it is
enough for them to assert that it is not, and ought not be, the
primary function of tort law to provide disaster relief, given that
other institutions, for example, private and public insurance, are
likely better suited to meeting those claims. Thus, the lottery
critique is not so much a devastating critique of tort law, as it is
a devastating critique of a legal system that relies solely on tort
law to effect needed disaster relief.90
It is at this juncture in the argument that the
jurisprudential and empirical claims of enterprise-liability
theory come to the fore. For the response to the foregoing
counter-argument is to deny that tort law can have any
intelligible purpose other than providing relief to accident
victims: if this is established, then nothing is lost by
substituting a more efficient scheme of compensation. That
denial in turn rests on the jurisprudential and empirical claims
discussed above. In other words, it is only because enterprise-
liability theorists suppose that notions of rights, duties,
proximate cause, etc. are inherently fictional that they assert
that tort law cannot be understood or defended as an institution
devoted to rectifying wrongs. In a similar fashion, the empirical
supposition that modern accidents are primarily lapse-based
permits these theorists to dismiss the idea that tort law can
serve functions other than compensating the injured. If modern
tort law is primarily concerned with a realm of ‘inevitable’
accidents, then there is little point in designing it either to
inquire into individual responsibility, or as a means of
sanctioning and deterring future misconduct through the issues
of damage awards.
I have already noted in connection with compensation-
deterrence theory that the Realist moral and legal skepticism
hardly deserves the status of gospel truth.91 Enterprise liability
theory is likewise far from invulnerable in its empirical
presuppositions. Some have challenged the assertion that

90 Goldberg, supra note 19, at (suggesting that distributive justice should be

attended to outside the tort system).

91 See supra text accompanying notes –62-63.

38
industrial, car, and product accidents are the sort of
inevitabilities that enterprise liability theory takes them to be.
For example, it is likely the case that modern product liability
actions do not often conform to the picture of assembly line
lapses invoked by the likes of Fleming James. Rather, they are
increasingly prone to assert claims based on manufacturers’
conscious design and warning choices. If in fact many product-
related accidents are advertent rather than inevitable, then the
enterprise liability theorist’s singular focus on compensation as
the goal of tort law becomes contestable, since conscious design
choices (as opposed to inevitable lapses) are both appropriate
subjects of an inquiry into responsibility, and perhaps capable of
being deterred by the threat of tort sanctions. This in turn
suggests alternative justifications for the award of ‘make whole’
and punitive damages of the sort that enterprise liability
theorists reject. It also suggests that tort law on the
compensation model may run the risk of over-deterring certain
high-risk, but high-value activities, such as the development of
experimental medicines. 92
Other critics have attempted to hoist the prescriptive side
of enterprise-liability theory on its own petard. With respect to
the occasional call for judicial tort reform in favor of expanding
liability, critics have argued that a broad expansion of tort
liability can have the effect of chasing off liability insurance,
which in turn defeats the very goals of cost-spreading and
compensation.93 Still others have suggested that broad-based
tort liability will not in fact spread costs equitably, but instead
will disproportionately fall on relatively worse-off consumers,
who will be forced to pay higher costs for products, automobile
insurance, and the like.94
Tort replacement schemes proposed by enterprise-liability
theorists have also come in for their share of criticism. The
experience of workers’ compensation schemes suggests that they
disfavor the critically injured at the expense of those suffering

92 James A. Henderson & Aaron Twerski, Closing the American Products

Liability Frontier: The Rejection of Liability without Defect, 66 N.Y.U. L. REV. 1263,
1321-22 (1991).
93 George L. Priest, The Current Insurance Crisis and Modern Tort Law, 96 YALE

L.J. 1521, 1525 (1987).

94 Id. at 1585-86.

39
lesser injuries.95 Normatively, critics have suggested that many
of the schemes proposed by enterprise liability theorists are no
more principled than the negligence regime they would replace.
For example, consider ‘no fault’ automobile insurance schemes,
which rely on mandatory insurance to enable those injured in
accidents to recover compensation. In effect, these schemes
mandate that the costs of car accidents by distributed among all
drivers, but only drivers. Why should all drivers, even careful,
low-risk drivers, be made to bear the cost of the negligent
driving of others? Even if they should, why shouldn’t other
classes of actors – pedestrians, landowners, product-
manufacturers -- be compelled to join the insurance pool? If
mandatory insurance schemes are the preferred solution to the
social dislocation caused by accidents, does not fairness require
that they be funded by generally applicable taxes, and be
available not only the victims of human-generated accidents, but
all disasters that happen to befall innocent victims?96

IV. ECONOMIC DETERRENCE THEORY

Economic deterrence theories of tort emerged largely in
response to perceived defects in enterprise liability theory and
compensation-deterrence theory. By disposition less suspicious
of capital and markets, most economic theorists were put off by
the anti-capitalist and redistributive politics lurking close to the
surface of enterprise liability theory.97 Likewise, to their eyes,
the amateur policy-making characteristic of compensation-
deterrence theory lacked rigor. To make up for both of these
perceived weaknesses, economic deterrence theorists have
enlisted microeconomic analysis to interpret and analyze tort
law.
Both the traditional account and enterprise-liability theory,
as we have seen, primarily adopt an after-the-fact perspective on
injurious conduct: they analyze how the law might assign
95 REPORTERS’ STUDY, supra note 27, at 115-17.
96 Franklin, supra note 79, at 777.
97 Most but not all. Calabresi’s project was to enlist economics to rescue some of

the tenets of enterprise liability theory, a project more recently undertaken by

Professors Croley and Hanson. See Neil Duxbury, Law and Economics, Science and
Politics, 15 L. & HIST. REV. 323, 326 (1997) (noting the difference between Calabresi’s
project from those of Coase and Posner); Steven P. Croley & Jon D. Hanson, Rescuing
the Revolution: The Revived Case for Enterprise Liability, 91 MICH. L. REV. 683, 767-
86 (1993).

40
responsibility or spread losses traceable to human conduct once
they have occurred. Economic deterrence theories of tort, by
contrast, adopt an ex ante perspective. They assume or posit
that the purpose of tort law is to promote overall social welfare
by deterring accidents in the future. By providing successful
plaintiffs with injunctions and/or monetary damages, tort law
generates penalties -- sanctions that give future actors a
material incentive either to take precautions while acting, or to
avoid the activity altogether.
Theories linking law to the deterrence of undesirable
conduct have a long history in Anglo-American thought, tracing
back through Bentham to Hobbes. As we have seen, even early
compensation-deterrence theorists noted deterrence as one of
two goals that tort law sometimes serves. In the second half of
the century, however, academics employing the analytic
techniques of microeconomics have developed theories that are
more purely focused on efficient deterrence of accidents as the
goal of accident law. Leaders in this branch of tort scholarship
include John Brown, Guido Calabresi, Ronald Coase, Robert
Cooter, Richard Epstein, Mark Grady, Jon Hansen, William
Landes, Richard Posner, and Steven Shavell.
The starting point for economic deterrence theories of tort
is the microeconomic assumption that an individual (or entity)
makes the decision about whether or how to engage in a given
activity by weighing the costs and benefits to her of the activity.
In making this calculation, the self-interested person by
definition considers only the costs that she will have to bear, not
costs imposed on others. Other things being equal, a person who
owns a pig farm adjacent to a residential neighborhood will
increase the number of pigs on the farm up to the point at which
the cost to her of adding one more pig is equal to the benefit she
derives from that pig. Absent some legal rule addressing her
conduct, the owner will not include among her costs any costs
imposed on neighbors who experience a loss in quality of life as
the presence of foul odors and noise increases with the swine
population. These latter sorts of costs are deemed
“externalities.” By imposing injunctions or damage awards on
actors, tort law can force them to take into account --
“internalize” -- externalities when they decide whether or how to
act. Once our imagined pig-farmer, for example, is subject to a

41
legal rule that she must compensate her neighbors for creating a
nuisance, she may well conclude that she should keep fewer of
them. The question posed by economic analysis of tort law is
thus: under what circumstances, and to what extent, should tort
law force actors to internalize costs?
Because economics is concerned with determining how
society as a whole can make the most efficient use of its
resources, it recommends that sanctions should be set so as to
achieve the “socially optimal” mix of precautions and accidents.
The assumption here is that, at a certain point, it will cease to
make economic sense to take precautions against accidents,
because the expense of those precautions will exceed the losses
associated with the accidents themselves. Thus, in principle, if
tort law is working correctly, the threat of liability will cause
actors to take all and only those precautions that cost less than
the harms that are expected to result if those precautions are
not taken. Put another way, the goal of tort law, from the
standpoint of economic analysis is to minimize the sum of three
factors: the costs of accident prevention, the costs resulting from
accidents, and the costs of administering the tort system.
From these shared starting points, economic deterrence
theory divides rather sharply into two branches. The first
branch, developed by Richard Posner and William Landes, is
mainly devoted to asserting the interpretive claim that the
analytic tool of efficiency can permit us to understand the basic
features of tort law. The second branch is concerned to provide
prescriptive analysis that seeks to determine how accident law
ought to be designed if it is to achieve the efficient mix of
precautions and accidents.

A. INTERPRETIVE ECONOMIC DETERRENCE THEORY

In The Economic Structure of Tort Law98 and other
writings,99 William Landes and Richard Posner have claimed
that the concept of efficiency is the Rosetta Stone of tort law.
Emblematic is Posner’s treatment of the negligence concept of
fault or carelessness, which is defined in American jury
instructions as a failure to act as would a reasonable or prudent

98 WILLIAM M. LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF TORT

LAW (1987).
99 Richard A. Posner, A Theory of Negligence, 1 J. LEG. STUD. 29, 31-32 (1972).

42
person under the circumstances. On its face, the meaning and
function of fault, Posner suggests, poses a puzzle. The concepts
of “reasonableness” and “prudence” seem to be moral concepts.
Yet the legal definition of fault is inconsistent with a moral
interpretation because it is an “objective” standard that holds
individuals accountable even when their lack of dexterity or
mental capacity renders them incapable of meeting it.100 The
puzzle is dissolved, however, by comprehending that fault
expresses negligence law’s commitment not to morality, but to
efficient deterrence. When negligence predicates the award of
damages for injuries on the presence of “unreasonable” conduct,
it in fact denounces and deters conduct that wastes society’s
resources. To be “at fault” is to have committed waste by failing
to take a precaution that would have been cheaper than the
expected costs of the accident; hence to sanction faulty conduct
is to promote efficient deterrence. Primary doctrinal support for
this interpretation of negligence-qua-wastefulness is found in
Learned Hand’s suggestion in United States v. Carroll Towing
that it might be helpful to think of negligence in algebraic terms,
as the failure to take a precaution, the cost of which (B) is
smaller than the losses expected to result from not taking the
precaution (P x L).101
In similar fashion, Landes and Posner argue that nearly
every other basic tort concept and doctrine is explicable in terms
of efficient deterrence. Thus, efficiency is understood to provide
the substance and rationale for the general applicability of the
negligence standard to unintentional wrongs; the application of
strict liability to product-related injuries; the classification of
certain torts as intentional; the rules that determine the
availability of injunctive relief versus damages; the limited
availability of punitive damages, etc.102 To take but one
illustration from this list: efficiency explains the function of
imposing liability on intentional wrongs, such as the wrong of
converting (stealing) another’s property. As applied to
intentional expropriations, the tort of conversion penalizes such
conduct -- even if the converter values the property more than

100 Id. at 29, 29-30.

101 Id. at 31-32
102 See generally LANDES & POSNER, supra note 98(applying economic analysis to

explain and elucidate a wide range of doctrines).

43
the owner -- because a general system of coerced transfers of
wealth will generate greater transaction costs than a general
system of voluntary transfers. In other words, intentional
conversions are actionable because it is generally more efficient
to have a system of ‘property rights plus bargaining’ than a
system of ‘hold on to whatever you can’. This in turn explains
the availability of punitive damages for such intentional torts:
the law aims strongly to steer people toward bargaining and
away from stealing. 103
In sum, the central interpretive claim of economic
deterrence theory is that tort law reveals a systematic concern
to achieve efficient deterrence. Indeed, Landes and Posner go so
far as to claim that tort doctrine – at least as it existed in the
first half of the Twentieth Century -- tracks nearly perfectly the
rules that would have been chosen by an efficiency analyst who
knew nothing of the state of existing law. With this claim,
however, the economic interpretation poses a new puzzle: what
can explain the fact that generations of judges, working
independently over time and across jurisdictions, usually
without the benefit of economic analysis, came to produce a set
of rules that consistently reflect efficiency considerations? Here,
the economic interpretivist invokes historical and normative
considerations.
In its historical dimension, interpretive economic
deterrence theory posits that there are institutional mechanisms
within the common law, akin to the natural selection
mechanisms of biology, that tend to extinguish inefficient
doctrines while leaving efficient doctrines intact. Some, for
example, have supposed that the market for litigation generates
incentives to litigate only inefficient rules, thus entailing that,
over time, only these rules will be subject to challenge and
overturning.104 This quasi-Darwinian account is supplemented
with an account that accords greater causal force to human
agency. Landes and Posner argued, among other things, that
courts would incline toward efficiency as a goal that is relatively
realistically attainable through judicial decision, as opposed to

103 Id. at 48.

104 See generally Jeffrey Evans Stake, Pushing Evolutionary Analysis of Law, 53
FLA. L. REV. 875, 880 & n.22 (2001) (describing and citing various works positing an
evolution toward efficiency).

44
other goals (widespread redistribution, in particular) that they
deemed unattainable by that means.105 Posner also has argued
the leading American judges in the golden age of common law,
including Cardozo and Hand, were early practitioners of
economic thinking in law.106 This fact helps explain why the law
that bears their influence has come to embody efficiency
considerations. Finally, economic deterrence theory offers a
normative thesis that purports to unravel the apparent mystery
of the common law’s evolution toward efficiency. This is the
thesis that efficiency – wealth-maximization – is a worthy goal
to which the law ought to aspire (the worthy goal, in the hands
of certain theorists).107 Hence it is no surprise to find that
common law judges have aspired to it.

B. PRESCRIPTIVE ECONOMIC DETERRENCE THEORY

The other major school of economic deterrence theory is
content with project of analyzing the likely deterrent effect of
different tort rules. On the view of these scholars, the question
with respect to a particular tort doctrine, or tort law generally,
is hypothetical and analytic: assuming one aspires to promote
efficient use of resources in the future, what rules and sanctions
ought to be chosen?
As Coase and Calabresi first emphasized in two landmark
articles, this project is fraught with peril.108 The expurgation of
ex post inquiry from forward-looking deterrence analysis often
proves difficult to accomplish, simply because notions of
responsibility are deeply embedded in ordinary English
language. Suppose that every year in a given jurisdiction there
are a certain number of accidents involving cars colliding with
bicyclists, as a result of which some cyclists, but no cars or
drivers, are harmed. In ordinary usage, it would be perfectly
correct to say that car drivers “caused” these injuries. Yet, to
use cause in this way is already to import an ex post perspective

105 See LANDES & POSNER, supra note98, at 18-19.

106 RICHARD A. POSNER, CARDOZO: A STUDY IN REPUTATION 99-101 (1990); Posner,
supra note 99, at 32 (discussing the Hand formula).
107 Richard A. Posner, Wealth Maximization in Tort Law, in PHILOSOPHICAL

FOUNDATIONS OF TORT LAW, supra note 66, at 99-103..

108 Guido Calabresi, Some Thoughts on Risk Distribution and the Law of Torts,

70 YALE L. J. 499 (1961); R. H. Coase, The Problem of Social Cost, 3 J. L. & ECON. 1
(1960).

45
that threatens to distort forward-looking deterrence analysis.
To label a driver as the cause of this sort of accident implies that
the driver -- as the active causer -- is responsible, whereas the
cyclists -- as passive victims -- are not. From a genuine
deterrence perspective, however, both driver and the pedestrian
must be understood as causers of the accident because each had
to take certain actions (driving, riding) in order for the collisions
to occur, and thus each is equally eligible as a candidate for
sanction and future deterrence. Thus, instead of asking who
caused the accident, the economist must ask (at least in the first
instance): (1) are there cost-efficient precautions that one or
more actor(s) can take in this sort of situation that will prevent
or reduce the severity of these accidents?; and (2), if so, whom
should the law sanction so as to encourage the taking of those
precautions?
Consider how this strictly forward-looking analysis might
apply to the accidents just hypothesized. Suppose it turns out
that the net losses associated with car-bike accidents could be
reduced if cyclists were to use safety equipment, including
reflectors, flags, and helmets. Economic analysis dictates that
these precautions be taken simply because fewer of society’s
resources will be spent on these accidents. But whom, then,
should the law sanction to ensure these efficient precautions are
taken? The intuitive answer would seem to be that the law
should sanction cyclists by adopting a rule of no driver liability.
This will force future cyclists to bear the costs of accidents,
giving them incentives to take the efficient precautions.
As Coase demonstrated, however, this intuition requires
some refinement. In an imagined world with no “transaction
costs” (i.e., costless access to all relevant information, error-free
comprehension of that information, effortless negotiating, etc.), a
law concerned only with ensuring that the efficient precautions
be taken will be indifferent as to who is made to pay for the
cyclists’ losses. Suppose, for example, we adopt the counter-
intuitive rule; namely the rule of driver liability. Given the
assumption of no-transaction costs, it follows that drivers will
just as readily identify the cycling equipment as the cheapest
precaution and then pay the cyclists to use the equipment. To
be sure, the different rules – cyclist liability versus driver
liability – will have an important distributional consequence:

46
under the first rule, cyclists will have less disposable income
because they have to bear the cost of precautions, whereas under
the driver-liability regime, drivers will have less income because
they have to buy the equipment for the cyclists. But, this
distributional question is, at least at first blush, irrelevant to
efficient deterrence analysis. The question is not whether it is
fair to saddle the cyclists or the drivers with the costs, but how
to arrange incentives so that the efficient precaution will be
taken.
The significance of Coasean analysis is not limited to the
negative point that, in the absence of transaction costs, the
choice of whom to sanction will not matter. For, as Calabresi
emphasized, implicit in this observation is a positive claim more
relevant to the real world. Once transactions costs are re-
introduced into the analysis -- for example, it is surely will not
be costless for drivers to identify the relevant biking equipment,
nor to convince cyclists to use it -- a critical question for
economic analysis comes into focus: who among possible bearers
of liability is in the best position to identify and implement the
efficient precaution? In Calabresi’s terminology, the economic
deterrence analyst will want to know not only what precautions
are efficient to take, but who is the “cheapest cost avoider” – the
actor in a position to implement those precautions most
cheaply.109
Against the conceptual background set by Coase and
Calabresi, analytic economists in the 1970s devoted much of
their attention to providing an economic answer to the central
question in modern accident law since the time of Holmes: is it
better to adopt as a default rule for accidental harms the rule of
strict (no-fault) liability or a rule of negligence? Brown and
Shavell demonstrated that, in many instances, the economic
answer to this question is indeterminate.110
Consider, for example, Shavell’s analysis of our car-bicycle
accident scenario.111 Assume that, if no precautions are taken,
bicyclists will suffer $15,000 in expenses, pain, and lost wages

109 Calabresi goes further and argues that courts often have access to

information that is only sufficient to permit a thoughtful answer to the “who”

question. See Guido Calabresi & Jon Hirschoff, Toward a Test for Strict Liability in
Tort, 81 YALE L.J. 1055, 1060-61 (1972).
110 STEVEN SHAVELL, ECONOMIC ANALYSIS OF ACCIDENT LAW 36-32 (1987).
111 Id.

47
per year. Suppose further, that the amount of annual losses
could be reduced in the following ways. First, car drivers could
install at an aggregate expense of $2,000 per year daytime
running lights that make their cars more observable to cyclists.
If no other precautions were taken, this would reduce total
accident costs to $12,000. Alternatively, cyclists could adopt
protective gear for a total cost of $3,000 that would, in the
absence of any other precautions, reduce accident costs to
$10,000. Finally, if running lights and protective equipment
are both used, the cost of accidents will be reduced to $6,000. In
this scenario, it is efficient for each actor to take care regardless
of what the other does because the cost of precaution for each is
smaller than the expected reduction in accident costs that
follows from taking the precaution. However, the optimal
solution is for both parties to take care, since that course of
conduct produces the smallest sum of precaution costs and
accident costs ($2,000 + $3,000 + $6,000 = $11,000). Which
liability rule -- strict liability or negligence -- will ensure that
this efficient solution will be achieved?
The answer is either, so long as the strict liability regime
includes a defense based on the plaintiff’s fault. Under a
negligence rule, by definition, each driver knows that if she
installs daytime running lights she will be found by definition
not to have been at fault (because she took the efficient
precaution), and will not be held liable for cyclists’ losses flowing
from her driving. Likewise, because it is assumed that the
cyclist knows that drivers will act efficiently by installing
running lights, cyclists know that they will have to bear their
own losses, and therefore will pay for protective gear, which is
cheaper to them than paying for the cost of injuries that result
from not wearing the gear. Thus, negligence achieves the
optimal result.
Now consider a regime of strict liability with contributory
fault. Under that regime, drivers’ taking reasonable precautions
by definition will not eliminate their liability for any losses
incurred (this is what means, to the economist, to have a system
of “strict” liability). Nonetheless, it still will be cheaper for them
to pay $2,000 plus $12,000 in accident costs than to pay $15,000
in such costs, so they will take the precaution of installing
running lights. Meanwhile, because the contributory fault

48
defense will bar cyclists from recovering from the driver if they
(the cyclists) do not take efficient precautions available to them,
the cyclists will have an incentive wear protective gear to ensure
that they can recover any losses incurred as a result of collisions
with cars
In short, so long as there is a fault determination applicable
to at least one party in the litigation, the socially optimal
(efficient) precaution will be adopted by the parties. However,
this does not mean the two rules are identical in impact. In
particular, the two regimes differ over who will bear the residual
$6,000 in loss that will still occur even after precautions are
taken. Under the negligence rule, when both parties take care,
the residual accident costs will be borne by cyclists. Under the
strict liability rule, both parties will again take care, but the
residual costs will be borne by drivers. As indicated above,
economic analysis is not concerned with this issue in terms of
whether it is fair to saddle one or the other groups with this loss.
However, as Shavell pointed out, the distributional difference
may have economic implications once we take into account the
fact that an actor’s ability to prevent accidents is affected not
only by taking precautions, but also by the extent to which she
engages in a particular activity.112 Under a strict liability
regime, as we have seen, even drivers who take due care in
operating their vehicles must, at least in the first instance, pay
for the residual cost of accidents they cause. Thus, although
they can’t reduce the risk of being made to pay for cyclists’
injuries by being more careful in their driving, they may decide
that, given the cost of driving under the strict liability rule, they
will simply drive less. Economic analysis therefore suggests
that the choice of liability rule should turn in part on whether it
is economically more desirable to suppress driving or
bicycling.113
Apart from these incentive effects, there is another
potentially critical difference between negligence and strict
liability regimes: their respective administrative costs.
Calabresi and Epstein, in particular, have argued that, even if
the different liability regimes are identical in terms of their
incentive effects, strict liability regimes are to be preferred

112 Id. at 29.

113 Id.

49
simply because negligence regimes are likely to be more
expensive to operate. This is so for several reasons. First, in the
real world, making the determination as to whether or not a
given defendant’s conduct has in fact run afoul of the Hand
Formula requires the gathering and analysis of a good deal of
information. Moreover, given that the information is often
partial and indeterminate, and is being examined and applied
by jurors and judges with no particular expertise in subjects
such as traffic accidents, there are likely to be many erroneous
determinations of fault.114 In both of these ways, the negligence
regime creates greater costs than a regime of strict liability,
which does not call for a determination of defendant’s fault
(although it still requires an inquiry into plaintiff’s fault). It is
possible, however, that by lowering the bar to recovery, a strict
liability rule will encourage more claims and thus more overall
administrative expenses. Nonetheless, both Calabresi and
Epstein have asserted that the cost-increase associated with the
greater volume of claims under strict liability will likely be
smaller than the costs associated with administering a
negligence regime.115
Aside from questions about the efficiency of particular
doctrines, a final and more global question that has occupied
prescriptive economic deterrence theory is whether accident law
taken as a whole, regardless of the liability standard, is well
designed to achieve optimal deterrence. This question in turn
breaks out into two subsidiary questions. The first inquires as
to where, from an efficiency standpoint, the domain of contract
should end and tort begin. The second grants that tort law has
a legitimate domain independent of contract, but inquires
whether it enhances efficiency as compared to alternative
schemes for deterrence.
Tort law often identifies conduct subject to sanction in a
one-size-fits-all manner. To the extent this precludes parties
from structuring their conduct in a way satisfactory to one
another, tort may introduce inefficiencies as compared to a
regime of contract. For example, the tort rules of product
liability entail that product manufacturers may never waive the

114Abraham, supra note 51, at 1202-03.

115GUIDO CALABRESI, THE COST OF ACCIDENTS 255-59 (1970); RICHARD A. EPSTEIN,
TORTS 95-96 (1999).

50
obligation to manufacture products meeting the legal standard
for non-defectiveness. As such, these rules will tend to suppress
or prevent the manufacturing and marketing of products that
might be only slightly less safe, yet cheaper, thereby in turn
preventing consumers from deciding for themselves to trade off
safety for price. In effect, tort law mandates the consumer’s
purchase of liability insurance from the manufacturer, when it
is entirely possible that fully-informed consumers might choose
to forego that insurance in exchange for a cheaper product.116
Here the debate among economists centers on the degree to
which parties are likely to enter into such transactions with
access to good information, with clear understandings of that
information, with a genuine will and ability to negotiate, and
the like.117
Finally, even for interactions that the economic analyst
concludes ought not to be governed by contract, there is a
further question, posed earlier in connection with the
plausibility of efficiency theory, namely: Is efficient deterrence
best achieved by a system of victim-initiated lawsuits in which
sanctions are set by the backward-looking criterion of losses
already suffered rather than forward-looking concerns of
efficient deterrence? Might it not be better instead to have a
decoupled system of regulatory fines to induce efficient behavior,
combined with compensation paid out of public and/or private
insurance? Many economists suppose the answer to these
questions points away from tort, toward some model of separate
systems issuing fines and compensation.118

C. CRITICISMS OF ECONOMIC DETERRENCE THEORY

In its ambition and reductionism, interpretive economic
deterrence theory, at least in the influential version posited by
Landes and Posner, is perhaps rivaled only by the vulgar
Marxist thesis that each facet of the law is an expression of the
class struggle. And just as the reductionist aspirations of
certain forms of Marxism have left it subject to serious attacks,

116 Priest, supra note 93, at 1585.

117 See generally Mark Geistfeld, The Political Economy of Neocontractual
Proposals for Products Liability Reform, 72 TEX. L. REV. 803 (1994) (analyzing the role
of contract in products liability law).
118 James J. Heckman, The Intellectual Roots of the Law and Economics

Movement, 15 L. & HIST. REV. 327, 328-29 (1997).

51
so too it has proved a vulnerability of interpretive economic
analysis.
To the extent interpretive economic analysis purports to
capture the meaning of the concepts that citizens and legal
actors actually employ -- for example, what they mean by
ascribing ‘fault’ to certain conduct -- that attempt must be
considered a failure. For example, Judge Posner’s assertion that
ascriptions of fault carry opprobrium because faulty conduct
violates a norm against wasteful conduct is far-fetched, to say
the least. One imagines a person who hears a tale of medical
malpractice shaking her head and proclaiming: “Oh, it’s so awful
when doctors fritter away our resources like that. If only they
would stop squandering societal wealth.”
Likewise, the idea that fault is a concept that only economic
theory can explain is premised on an assumption that many
have rejected: namely that “objective fault” is incompatible with
notions of morality or justice.119 Others have demonstrated that
the algebraic formulation of fault propounded by Learned Hand
was likely not an attempt to define fault in terms of efficient
resource allocation. Rather, Hand’s formula evokes only the
abstract notion that a judge or jury faced with assessing fault
must balance certain considerations, without defining in any
precise way what can count as a burden of precaution, nor which
among all the possible losses caused by someone’s conduct ought
to be counted. As such Hand’s formula is open to a reading --
and probably was originally intended to support a reading --
under which the judge or jury considers the value of the
defendant’s risk-creating activity and discriminates among the
types of losses that might result from the activity, two
normative inquiries probably incompatible with a strictly
economic reading of the Hand formula.120
Prescriptive economists have themselves suggested that
various tort doctrines are in fact quite inexplicable in terms of
efficiency. Shavell and Polinsky, for example, have argued that
efficiency counsels that punitive damages should not be
awarded, as they are now awarded, for open and intentional

See supra note 59 and accompanying text.

119
120Stephen G. Gilles, On Determining Negligence: Hand Formula Balancing,
The Reasonable Person Standard, and the Jury, 54 VAND. L. REV. 813, 842-49 (2001);
Michael D. Green, Negligence = Economic Efficiency: Doubts >, 75 TEX. L. REV. 1605,
1611 (1997).

52
wrongful acts (e.g., intentional conversions or batteries), but
instead only when the underlying conduct is hard to detect (e.g.,
covert pollution).121 Likewise, Priest famously argued that
economic analysis disfavors the normal rule, which permits a
jury to award pain and suffering damages as part of the
plaintiff’s recovery for physical injuries.122
A related complaint against efficiency theory’s interpretive
account of tort law is that it ultimately cannot explain why we
find ourselves with the institution of tort law itself. In
particular, it is unclear why we would have a system that
requires plaintiffs to commence suit; nor one that employs lay
jurors to assess damages; nor one which requires the plaintiff to
prove that the defendant’s conduct caused injury to them.
In theory, at least, all conduct that threatens losses greater
than the cost of precaution ought to be deterred. Yet the
deterrence machinery of the tort system only kicks in if a private
victim chooses to sue. In principle, the goal of efficient
deterrence would thus be equally well-served by a system of
regulatory fines. In fact, given empirical evidence suggesting
that the vast majority of those with valid tort claims never
bother to sue, such as system is likely preferable. Economic
accounts therefore fail to offer a compelling account of the deep
structure of tort law – at best they offer arguments to the effect
that a system empowering victims to act as private attorneys
general will be more efficient than a scheme of regulatory fines.
Tellingly, the structural criticism of interpretive economic
deterrence theory comes not only from theorists who are
predisposed to be suspicious of economic analysis of law, but
from economists themselves.123
Even if economic analysis can be shown to support a
scheme of deterrence driven by private lawsuits, it again must
be indifferent as between the system that we have, which only

121 A. Mitchell Polinsky & Steven Shavell, Punitive Damages: An Economic

Analysis, 111 HARV. L. REV. 869, 954 (1998).

122 See Priest, supra note 93, at 1546-47. But see Steven P. Croley & Jon D.

Hanson, The Non-Pecuniary Costs of Accidents: Pain-and-Suffering Damages in Tort

Law, 108 HARV. L. REV. 1785, 1791 (1995).
123 ERNEST WEINRIB, THE IDEA OF PRIVATE LAW 46-48 (1995); Jules L. Coleman,
The Structure of Tort Law, 97 Yale L.J. 1233, 1245 (1988) (reviewing STEVEN
SHAVELL, ECONOMIC ANALYSIS OF ACCIDENT LAW (1987) and WILLIAM M. LANDES &
RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF TORT LAW (1987)); Heckman, supra
note 118, at 328-29.

53
permits suits by a person actually injured by tortious conduct,
and a system which would permit all persons endangered by
tortious conduct to sue to recover his or her pro rata portion of
the expected loss generated by the conduct. For example,
imagine an automobile driver who habitually speeds merely for
pleasure, thereby risking the lives of many pedestrians.
Imagine further that, for a time, he has the good fortune of
avoiding hitting or scaring any of them, until one day he collides
with and injures one. Assume that the driver’s conduct in each
instance is faulty because the cost of precaution is small
compared to the expected harm in terms of property damage and
physical injury. Landes and Posner’s explanation as to why the
law permits only the injured person to sue, rather than all put
at risk by the driving is ad hoc. Only the injured person can
sue, they suggest, because it is administratively cheaper, and
because the jury is more likely to do the P x L calculation
correctly with a case of actual damages in front of it. Both of
these explanations fail to capture the significance of the basic
tort requirement that a person must suffer an injury before
gaining standing to sue.124
The central role of the jury to the common law of tort
(which role, of course, has been superceded by statute in
commonwealth countries) is also facially puzzling. Why would
a system designed to achieve efficient deterrence employ lay
jurors to render the critical determination as to whether conduct
is faulty? Why have they never been instructed to consider
efficiency in making that determination? Whereas social and
individual justice theories can plausibly assert, respectively,
that jurors are asked to make this determination to provide a
popular check on powerful actors, or to keep legal notions of
fault in tune with ordinary-morality assessments of conduct, the
economist has no comparable interpretive story to offer.125
Instead, economic interpretivists seem wedded to Holmes’s hope
that, over time, judicial rules of law would replace ad hoc jury
determinations as to fault. Economic interpretivism not only
carries an implicit judge-over-jury bias, it shows a consistent
bias in favor of judges against all other institutional actors. By

124 Goldberg & Zipursky, supra note 64, at .

125 Steven Hetcher, The Jury is Out: __ Geo. L. J. ___ (2002) [In this symposium
issue].

54
positing that the common law, and only the common law, is
designed to, and does achieve, efficient deterrence, the economic
interpretation of tort law implies that judges, not legislatures or
agencies, are most competent to craft and adopt intelligent legal
rules.126 This implication is an awkward one, given the
contingent-yet-frequent association of the economic approach
with condemnations of judicial activism.
Finally, as the interpretivists among economic deterrence
theorists all but concede, they have a difficult time making
sense of the requirement, applicable to most tort plaintiffs, that
s/he prove but-for causation in order to recover damages. From
a deterrence perspective, faulty conduct ought to be deterred if it
risks harm in the future, regardless of whether it happened to
cause harm in the past. Thus, as Calabresi once noted, if one
could show that, by some coincidence, television manufacturers
were in the best position to deter future automobile accidents,
then economic analysis would call for the imposition of liability
on the television manufacturers, notwithstanding the absence of
any causal connection between their conduct and the accidents
being deterred.127
Landes and Posner respond to this objection by suggesting
that but-for causation is probative of ex ante probabilities. In
their view, the absence of but-for causation in a particular case
is a reason to deny recovery simply because it suggests that,
given the circumstances in which defendant acted, its conduct
contributed such a small marginal increment of risk as
compared with other factors, that it would be inefficient to
incentivize the defendant to take this precaution in the future.
The absence of but-for causation, in other words, tells us that
the P factor in the Hand Formula is very small, and hence that
the failure of the defendant to take precautions cannot even be
considered careless. This collapse of causation into fault defies
common sense and ordinary legal usage.128 It would be bizarre
to say of a hotel owner that he has not been careless in omitting
to attach a fire escape simply because, when a fire occurred, it
fortuitously happened to kill only a physically infirm guest who
126 LANDES AND POSNER, supra note 98, at 18 (suggesting that judges’ political

insulation will permit them to make objective (i.e., non redistributive) decisions).
127 CALABRESI, supra note 115, at 136.
128 Richard W. Wright, Actual Causation v. Probabilistic Linkage, The Bane of

Economic Analysis, 14 J. LEG. STUD. 435, 439 (1985).

55
could not have used the fire escape were it present. Indeed, it
would perfectly intelligible to prosecute him for negligent
endangerment (assuming such a crime existed) notwithstanding
the fact that the guest’s death would have occurred even in the
presence of a fire escape, thus barring the guest’s tort claim for
lack of causation.
Interpretive economists’ historical theses have also been
subject to serious challenge. The quasi-Darwinian thesis has
been attacked for its failure to identify a plausible selection
mechanism to explain why only efficient rules survive. For
example, even if litigation incentives exist to challenge only
inefficient rules, this explanation offers no account of why we
have the system of common law litigation itself, thus begging
the Darwinian question.129 It is, of course, open to the
interpretive economist to simply take the existence of the
common law as a given, and to limit himself to a “path-
dependent” explanation as to why the law has moved toward
efficiency given where it started.130 But then we would need to
know what is distinctive about recent history such that
efficiency concerns can provide a robust explanation of the shape
of the law in a way that they could not for the initial shaping of
the common law itself. To the extent this explanation invokes a
notion that judges have become increasingly self-conscious about
efficiency considerations, it ceases to be a Darwinian story, and
instead become a contentious claim about how judges have
reasoned about tort law. In this regard, it is worth noting that
Posner’s readings of Cardozo and Hand have been challenged for
containing serious inaccuracies.131 Finally, as even Posner
concedes, his normative arguments for the superiority of wealth-
maximization as the value to which tort law ought to aspire
have been discredited.132 This has lead him, most recently, to

129 JULES L. COLEMAN, THE PRACTICE OF PRINCIPLE 27 (2001).

130 Mark Geistfeld, Economics, Moral Philosophy and the Positive Analysis of
Tort Law, in PHILOSOPHY AND THE LAW OF TORTS 250, 252-57 (Gerald J. Postema ed.,
2001).
131 Gilles, supra note 120, at 842-49; Green, supra note 120, at 1611; Goldberg,

supra note 61, at 1438-41, 1450-55.

132 Richard A. Posner, The Problematics of Moral and Legal Theory, 111 HARV. L.

REV. 1637 (1998). Posner’s invocation of pragmatism as supporting a version of

skeptical subjectivism in moral reasoning is more than a little ironic. In the hands of
early practitioners such as Dewey, pragmatism was offered as an anti-skeptical creed
that sought to advance practical and moral reasoning by dissolving hard-and-fast

56
adopt a ‘pragmatist’ stance toward normative issues, which
denies that it is possible to assess rationally the validity of
different normative positions.133 With this gambit, interpretive
economic deterrence theory reveals itself to be less a defensible
interpretation of the law of tort, and more a series of
unfalsifiable assertions.
Prescriptive economic deterrence theory, too, has come in
for criticism. Obviously, a fundamental premise of the
deterrence model is that legal sanctions are capable of deterring.
As some enterprise liability theorists have argued, however,
there may be a good deal of tortious conduct that comes in the
form of momentary lapses that may not be deterrable. More
generally, the available evidence suggests that actors do not

distinctions between ideal and material, knowing and doing, subject and object, and,
most importantly for present purposes, objective fact and subjective value. See
generally JOHN DEWEY, THE QUEST FOR CERTAINTY: A STUDY OF THE RELATION OF
KNOWLEDGE AND ACTION 254-86 (1927) (arguing against strong versions of the fact-
value distinction, and in favor of the possibility of moral reasoning and moral
knowledge).
133 Posner, supra note 132. The foregoing discussion of weaknesses in
interpretive economic deterrence theory raises important issues bearing on how to
assess the adequacy of any interpretive account of tort law. Unfortunately, these
issues exceed the scope of the present Article.
One issue concerns how the phenomena in question are to be made sense of. Is it
enough to offer an theory that is consistent with typical case outcomes, or must one
capture what it is that legal actors mean when they invoke legal concepts and cases?
On one view, an interpretive account of tort is successful even if its account offers an
“as if” explanation. Thus, if the substance and structure of tort law is such that it
looks as if it were designed with efficient deterrence in mind, then one has offered an
adequate account of tort law even if there is evidence that the system was not
designed with that end in mind, and that participants in the system do not perceive
themselves as pursuing or arguing about that end. An opposing view holds that an
interpretive account is inadequate unless it captures what it is that lawyers and
judges mean when they invoke legal concepts.
A second issue concerns how comprehensive or complete an interpretation must
be before it is deemed adequate. One view on this subject, which might be dubbed
weak interpretivism, holds that an interpretive theory of tort is adequate so long as
tort doctrine and practice may plausibly be portrayed as consistent with that claim.
For example, a weakly interpretive economic theory might be content to establish that
existing negligence doctrines ‘serve’ the goal of efficient precaution in the sense that,
taken as a whole, the rules do not flout an efficiency rationale. By contrast, strong
interpretivism maintains that an interpretive claim succeeds only when it can
demonstrate how the institutions and doctrines of tort law are bound up in something
more than an ad hoc or contingent arrangement: that there is a ‘deep’ structure or
logic to the system.

57
respond to liability with anything like regularity.134 This
observation does not support a global condemnation of the
project of prescriptive economic deterrence theory, but it does
suggest that economists need to recognize the limits of economic
analysis, which only operates in realms, and with respect to
actors, who can be plausibly supposed to respond to legal
sanctions.
Another line of critique identifies a certain danger in the
artless application of economic method. While microeconomic
techniques can help analysts reason clearly, even careful
practitioners tend to feel the pressure to draw firm conclusions
about individual cases or problems without the necessary
information to apply the relevant economic models. To take one
example, Shavell moves from the analytic claim that strict
liability can affect activity levels to the tentative conclusion that
economic analysis supports the common law’s traditional
imposition of strict liability on extra-hazardous activities such
as blasting and the keeping of wild animals. Yet nowhere does
Shavell explain why it would be efficient for society to suppress
those activities.135 Likewise, Epstein merely asserts, with
virtually no support, that the administrative costs of the
negligence system probably make the economic case for strict
liability.136 In situations such as these, one may justifiably
worry that the economist is simply sneaking substantive
political judgments about the respective rights of different actors
under the guise of economic assertion.
A related criticism is that, to the extent prescriptive
economic deterrence theory is offered not merely for academics,
but for lawyers, it will often be difficult to operationalize in
practice. Economic arguments are at times sensitive to small
changes in assumptions, and that makes the method
manipulable, perhaps as manipulable as the traditional
doctrinal analysis it seeks to supplant. Even if not so
manipulable, it is prone to erroneous application by judges and
lawyers who generally lack the requisite training, and hence

134 See generally DON DEWEES, DAVID DUFF, & MICHAEL TREBILCOCK, EXPLORING

THE DOMAIN OF ACCIDENT LAW (1996) (discussing empirical evidence on the deterrent
effects of tort law).
135 SHAVELL, supra note 110, at 31.
136 EPSTEIN, supra note 115, at 96-99.

58
tend to make category mistakes or otherwise are unaware of
what they don’t know in applying its methods.
An important dilemma facing economic analysis at the
moment concerns the extent to which it is desirable for the
analyst to relax the strict assumption of individual rationality so
as to make economic models of behavior more realistic.
Integrating cognitive psychology and social norm theory holds
out the promise of making economic analysis more nuanced by
expanding what can ‘count’ as a cost and benefit, and by
considering how cognitive biases cause actors to distort
information about those costs and benefits.137 However, in doing
so, it may become even more indeterminate and less capable of
generating predictions about the effects of sanctions on
behavior. To take only the simplest example, if actors routinely
under- or over-estimate the probabilities of certain risks being
realized, that fact has serious implications for the law’s ability to
induce efficient precaution-taking by means of Hand-formula
negligence standards. Likewise, if individual decisionmaking is
affected by how decisions are “framed”, then those biases will
have to be taken into account in designing legal rules.
Finally, economists have by and large failed to offer any
serious defense of the normative desirability of efficiency as a
goal for the tort system. Of course it is open to the economist to
say that the normative case for efficiency may be assumed, but
in doing so he begs a significant question of concern to the
lawyer and legal scholar: why should we embrace results
dictated by efficiency analysis if the law ought not aspire to
efficiency? While adopting an agnostic posture for purposes of
analysis can be good method, the worry is that particular
prescriptive economic deterrence theorists may tend to slip from
the agnostic posture of the detached analyst to a de facto
normative embrace of efficiency simply by refusing to discuss or
acknowledge other aims to which the law might aspire, or how
to reconcile those aspirations with the aspiration to efficiency.138
This is especially a danger if it is the case – as it likely is – that

137 See generally Jeffrey J. Rachlinski, A Positive Psychological Theory of

Judging in Hindsight, 65 U. CHI. L. REV. 571 (1998) (analyzing the role of hindsight
bias in assessments of fault and liability).
138 James R. Hackney, Jr., Law and Neoclassical Economics: Science, Politics,

and the Reconfiguration of American Tort Law Theory, 15 L. & HIST. REV. 275, 307,
311 (1997).

59
many analytic economists embrace some form of moral
skepticism, under which alternative normative goals such as the
protection of rights or the achievement of a just distribution of
goods are regarded as chimerical. Recently, Professors Kaplow
and Shavell have attempted a systematic defense of the
normative claim that maximizing aggregate social welfare is the
appropriate goal for the legal system.139 This effort has been
greeted with considerable skepticism140

V. SOCIAL JUSTICE THEORY

Social justice theorists of tort conceive of it as a device for
rectifying imbalances in political power. Specifically, they posit
that tort corrects for pathologies of interest-group politics.
Moneyed interests, particularly corporations and their insurers,
block or distort legislation and capture regulatory agencies
designed to monitor and control them. As a result, they are able
to pursue the self-interest of their executives and shareholders
at the expense of the general public by producing dangerous
products and hiding critical information about their
dangerousness. So, for example, lobbyists for the gun industry
prevent meaningful gun safety legislation, while pharmaceutical
companies capture the regulatory process, thereby minimizing
FDA scrutiny of new and potentially dangerous drugs.
By arming citizens with the power to sue corporations for
misconduct outside of the legislative and regulatory process, tort
corrects for this imbalance of power. In particular, it permits
independent judges and especially juries to hold corporate
America (and other powerful actors) accountable. Thus,
negligence actions by gunshot victims, and public nuisance
actions by cities who bear the cost of treating those victims,
make up for the absence of effective gun control. Likewise,
product liability suits restrain pharmaceutical companies from
profiteering on dangerous and ineffective drugs. The social
justice conception of tort is most closely associated in practice
with Ralph Nader. Scholars who have developed this conception

139 Louis Kaplow & Steven Shavell, Fairness Versus Welfare, 114 HARV. L. REV.
961 (2001).
140 For some skepticism, see Michael B. Dorff, Why Welfare Depends on
Fairness: A Reply to Kaplow and Shavell, 74 S. CAL. L. REV. 847, 862-88 (2002).

60
further include Richard Abel, Anita Bernstein, Carl Bogus,
Thomas Koenig, and Michael Rustad.

A. Interpretive and Prescriptive Social Justice Theory.

The interpretive and prescriptive aspects of social-justice
theory focus on certain key features of the tort system that
permit it to bring powerful actors to heel. First, by generating
private rights of action, the common law of tort grants
individual citizens access both to a forum in which to question
corporate conduct and can generate penalties in the form of
damage payments that ‘send a message’ to corporate America.
In tort, the citizen can both vindicate his or her own claim to
rights against the powerful, and act as a “private attorney
general” policing the conduct of these actors.141 Second, these
theorists emphasize the evolving and open-ended nature of tort
causes of action, a quality that permits tort plaintiffs to address
new forms of domination and exploitation as they emerge.142
Third, social justice theory notes the value of the discovery
process in tort litigation, through which plaintiff’s lawyers can
uncover paper trails documenting instances of corporate
misinformation and malfeasance. Fourth, the theory places
singular emphasis on the role of the lay jury in tort litigation.
Here, the jury is conceived as a defender of the interests of the
common person against private corporate power, just as in
revolutionary times, it served as a vital check on the
governmental power of the English monarch.143 Finally, social
justice theory emphasizes the pivotal role played by damage
awards -- particularly punitive damage awards -- in restraining
self-interested corporate conduct. Only punitive damages, social
justice theory supposes, can establish that “tort does not pay” by
hitting the rich and powerful where they live; in the bank
account.144 Consistent with these interpretive claims, the
prescriptive side of social justice theory advocates liability
expansion in areas such as products liability, workplace
discrimination, and medical malpractice, and argues against

141 THOMAS H. KOENIG & MICHAEL L. RUSTAD, IN DEFENSE OF TORT LAW 9 (2001).
142 Anita Bernstein, Complaints, 32 MCGEORGE L. REV. 37, 51-53 (2000).
143 See Stephen Landsman, The Civil Jury in America: Scenes from an

Unappreciated History, 44 HASTINGS L.J. 579, 618-19 (1993) (drawing this

connection).
144 KOENIG & RUSTAD, supra note 141, at 175-204.

61
legislative and judicial tort efforts to limit court access and jury
discretion through devices such as aggressive judicial
management of cases, legislative damage caps, regulatory
preemption, and other species of modern tort reform.145
Social justice theory bears a family resemblance to
enterprise liability in its progressive politics. Yet it differs in
fundamental respects. Enterprise liability theory is predicated
on the idea of getting funds to those who need them as quickly
and efficiently as possible. It does not generally attribute
injuries to malevolent forces.146 Instead, they are treated as the
inevitable byproducts of the activities characteristic of an
industrial and post-industrial economy. Accordingly, the social-
justice theorist’s celebration of juries, punitive damages, and the
litigation system runs quite counter to the instincts of the
enterprise liability theorist, who typically believes that the ideal
solution lies in no-fault compensation schemes offering need-
based relief, rather than huge damage awards that punish
individual entities and provide ‘windfalls’ to individual
plaintiffs.147

B. CRITICISMS OF SOCIAL JUSTICE THEORY

Social justice theory has been criticized on various fronts.
To the extent it offers an interpretive account of tort law at
all, that account is so selective as nearly to disqualify it from
being a genuine interpretation. Interpretive social justice
theory, like interpretive compensation-deterrence theory, fixes
first on the power conferred by tort law on judges and juries.
Yet, whereas the latter explains tort doctrine, particularly
negligence doctrine, as an intricate and finely-calibrated
mechanism for the attainment of deterrence and compensation,
the former seems to posit a system that requires, and consists of,
two features: discovery and juries. Tort law, as it were, is the
law that enables small groups of citizens to identify, punish, and
re-distribute as they see fit.
Prescriptively, social justice theory presupposes a
particular conception of the political process as skewed
145 Richard L. Abel, Questioning the Counter-Majoritarian Thesis: The Case of

Torts, 49 DE PAUL L. REV. 533 (1999) (arguing that judges better represent the
interests of the people than legislatures and regulators).
146 Goldberg, supra note 78, at 2052-53.
147 Id. at 2057-59.

62
consistently against consumer and toward corporate interests.
To the extent that picture is not borne out in individual
instances of regulated conduct, the theory gains no purchase.
The theory can also mislead in suggesting that all or most tort
litigation takes the form of David-and-Goliath litigation of the
sort depicted in films such as Erin Brockovich and A Civil
Action. In fact, suits against particular industries, such as
asbestos and tobacco, even if initially brought by small,
entrepreneurial lawyers, can come to be managed as a retail
business by well-financed and well-organized plaintiffs’ firms
that, through organizations such as ATLA, have political clout of
their own. Whether this is a desirable state of affairs or not, it
is incumbent on social-justice theory to acknowledge that the
legislative and litigation playing fields are sometimes more level
than its proponents suggest.148
The account of ‘political economy’ undergirding social
justice theory is arguably likewise selective. If corporate and
other actors sometimes engage in self-interested conduct at the
expense of the public, they also at times compete in markets on
safety criteria. (Witness the emergence of safety as a key selling
point for the automobile once American markets were opened to
foreign competition.) Also, social justice theorists arguably have
not paid sufficient attention to the potentially regressive
features of tort liability. Insofar as liability translates into
products rendered more expensive by safety features or the cost
of liability insurance, tort will tend to affect lower-income
consumers more adversely than their wealthier counterparts.149
Social justice theory also rests on the populist supposition that
complex industrial processes, which often involve trading off one
kind of risk for another (rather than the complete elimination of
risk) can usefully be overseen by lay juries superimposing onto
those processes commonsense notions of good and evil. No
doubt, some, perhaps even a great deal, of corporate misconduct
may fit comfortably within this framework -- for example,
intentional cover-ups of information as to the risks associated
with products. Still, other conduct -- for example, a decision to

148 Stephen C. Yeazell, Re-Financing Civil Litigation, 51 DEPAUL L. REV. 183,

183 (2001).
149 Priest, supra note 93, at 1585.

63
forego a particular safety device -- may not.150 Finally, even
granted the premise of widespread corporate misfeasance, the
question arises as to whether litigation through the tort system,
which by its nature is adversarial, confrontational, and public, is
always or even typically the most effective means of persuading
corporate actors to adopt safer business practices.151

VI. INDIVIDUAL JUSTICE THEORY

Compensation-deterrence theory, enterprise-liability
theory, economic-deterrence theory, and social justice theory
each is grounded on the premise that the traditional account of
tort is inapplicable in modern conditions (if it ever was). Yet
each recognizes that the formalities of tort practice, as well as
the ‘language’ of tort law, reflect the heritage of the traditional
account. In the first instance, at least, tort actions such as the
negligence action do not seem to be designed to empower judges
and juries to make macroscopic legislative decisions about when
conduct should be deemed socially undesirable, or to deliver
accident insurance, or to ensure the efficient expenditure of
society’s resources on accidents, or to correct for systemic pro-
corporate biases in the political process. Rather, on the surface,
they seem to fit the description of the traditional account. That
is, they seem to empower victims of wrongdoing to seek redress
for those wrongs. In this sense, each of the foregoing theories
operates on the premise that, to be successful, a theory of
modern tort law must ‘pierce the veil’ of tort practice so as to
establish that the practice is accomplishing something other
than what it appears to be accomplishing.
As indicated in Part I, the explanation as to why much of
modern tort theory assumes the need for veil-piercing theories
owes to the belief that economic, political and intellectual
changes that commenced in earnest in the late nineteenth
century rendered the traditional account of tort practically,

150 Reid Hasty & W. Kip Viscusi, What Juries Can’t Do Well: The Jury’s

Performance as a Risk Manager, 40 ARIZ. L. REV. 901, 917 (1998); Gary T. Schwartz,
The Myth of the Ford Pinto Case, 43 RUTGERS L. REV. 1013, 1020-22 (1991)
(discussing misconceptions about Ford’s conduct).
151 By way of anecdote, Jan Schlictmann, attorney for the plaintiffs in the suit

giving rise to A Civil Action, has recently advocated mediation over litigation. See
Families and Companies Settle Toms River Cancer Cluster Case, 22 HAZ. WASTE
LITIG. REP. 10 (2002).

64
politically, and intellectually untenable.152 The emergence of
industrial and other mechanical accidents as the predominant
form of tortious conduct, the supposedly inherent conservatism
of judicial talk of “rights” and “duties,” and the prevalence in
academic circles of logical positivism, empiricism, utilitarianism
and legal realism, all coalesced into hostility toward the
traditional account.153
In the post-World War II period, scholars began to
reexamine the premises on which these tort theories have
preceded. In particular, with the rise of the civil rights
movement, the debunking of extreme forms of positivism and
empiricism, the failure of legal realism to deliver a positive
program, and the emergence of powerful anti-utilitarian moral
and political theories, legal academics working in constitutional
law began to rehabilitate traditional notions of liberty, justice,
rights and duties by establishing that they are applicable in the
modern world, do not necessarily align with laissez-faire, and
are not mere empty labels behind which judges hide.154 Tort
scholarship of the last 30 years of the twentieth century reflects
these developments. Thus, since 1970, a number of influential
tort theorists have sought to revive and refine various aspects of
the traditional account by connecting tort law to the doing of
justice between the parties to the litigation. Leaders in this
‘individual justice’ branch of tort theory have included Jules
Coleman, Richard Epstein, George Fletcher, Tony Honore,
Stephen Perry, Ernest Weinrib, Catherine Wells, and Richard
Wright.
Perhaps because it tends to be practiced by scholars with
training in analytic philosophy, individual justice theory comes
in many different forms. This Part will highlight three of them:
libertarian theory, reciprocity theory, and corrective justice
theory. In fact, each of these theories has been identified by its
author as a “corrective justice” theory of tort. I reserve that
term, however, to refer to one type of individual justice theory.

A. LIBERTARIAN THEORY

152 See supra text accompanying notes 20-26.

153 Id.
154 Goldberg & Zipursky, supra note 16, at 1799-1811.

65
 Libertarian tort theory unabashedly seeks to re-connect
tort law and laissez-faire politics by linking tort to concepts of
property and ownership. The premise of the theory is that a
person exercises absolute dominion over himself -- his body and
his reputation -- as well as those things he legitimately acquires
through his actions. The upside for individual actors is that all
goods that the actor rightfully claims, creates, or acquires are
his and his alone. No one, whether government or another
citizen, can rightly lay claim to them, nor even substantially
impair their value via taxation or other involuntary transfers.
The downside is that the actor owns his ‘bads’ as exclusively as
he owns his goods. To the extent he acts in a manner that
injures another’s person, possessions or reputation, the actor
‘owns’ the loss and must as a matter of justice make good on it
by compensating the victim.155 Libertarian theorists have
defended this premise on different grounds. Some have
suggested that it flows from the best understanding of liberal
political theory.156 Others argue that it (also) captures the
ordinary meaning of concepts such as causation.157

1. INTERPRETIVE LIBERTARIAN THEORY

Libertarian theory is not generally presented as providing a
compelling interpretive account of modern tort law. It has,
however, claimed historical support. Epstein, for example, has
at least suggested that libertarian theory accurately captures
the conception of liability found in ancient Roman and medieval
English law.158

2. PRESCRIPTIVE LIBERTARIAN THEORY

As compared to the current regime of accident law, in which
negligence dominates, libertarianism points simultaneously to
an expansion and contraction of tort liability. On the one hand,
the libertarian notion of owning the ‘bads’ one causes in the

155 Jules L. Coleman & Arthur Ripstein, Mischief and Misfortune, 41 MCGILL L.

J. 91, 102 (1995).

156 For an influential modern version of this argument, see ROBERT NOZICK,

ANARCHY, STATE AND UTOPIA 3-148 (1974).

157 Richard A. Epstein, A Theory of Strict Liability, 2 J. LEG. STUD. 151, 160-66

(1972).
158 Id. at 166-82 (drawing on older English cases to explicate a system of cause-

based liability).

66
world suggests a move from negligence to strict liability, since
the only question of interest to the libertarian is whether a given
victim’s loss is traceable to the acts of another.159 If it is, then
justice requires that ownership of the loss be transferred to the
other by means of a compensatory payment. (If it is not
traceable to the act of another, however, it is the victim’s alone
to bear except to the extent others are willing to volunteer
assistance). On the other hand, the same strong theory of
ownership that points to strict liability also suggests that
individuals have the unfettered right to engage in voluntary
transfers of property on terms they set, so long as third parties
are not harmed by the transaction. Thus, in areas such as
medical malpractice and products liability, the libertarian tends
to argue that tort law operates in an unjustifiably paternalistic
way by forcing patients and consumers to purchase a mandated
level of safety, even if they would prefer to have cheaper and less
safe goods and services.

3. CRITICISMS OF LIBERTARIAN THEORY

Libertarian tort theory has been criticized on various
fronts. Its initial premise of exclusive ownership is, needless to
say, quite strong and controversial as a matter of political
theory. Likewise, its attempt to describe all rights as variants
on the paradigmatic right of private property ownership is
problematic. For example, the assertion that person P “owns”
his good name, taken literally, would suggest that P owns the
thoughts of others: after all, it is their thoughts about, or
dispositions toward, P that determine his reputation.160 The
libertarian theorist might retort that this criticism takes the
concept of ownership too literally. This response, however,
comes at considerable cost. Shifting from actual to metaphoric
ownership is like switching from actual to hypothetical consent –
it diminishes the strength of, and significantly alters the
grounds for, the argument.161 The claim is no longer that one
who defames P has actually damaged or converted P’s property,

159 Coleman & Ripstein, supra note 154, at 102.

160 Thanks to Don Herzog for this point.
161 See Ronald Dworkin, Why Efficiency: A Response to Professors Calabresi and

Posner, 8 HOFSTRA L. REV. 563, 574-75 (1980) (noting that shift from actual to
hypothetical consent fundamentally changes the nature of the argument in favor of
treating wealth as a good).

67
but that P has suffered an injury to an interest of P’s that, in
some respects, resembles his interest in undisturbed ownership
and enjoyment of his tangible property. Implicit in the latter
formulation of the argument is the concession that, in other
respects, the interest in reputation does not resemble the
interest in owning real property, and hence might appropriately
be protected by different rules.
Invoking the Coase-Calabresi observation about the
inherent reciprocity of causation, Stephen Perry has further
argued that libertarians’ reliance on causation as the ground for
assigning liability is necessarily indeterminate. A tort cannot
occur except by the acts of two actors: as a matter of physics, the
plaintiff’s broken nose is caused by the defendant’s blow and by
the plaintiff’s having brought himself in proximity to the
defendant, hence ownership of the loss associated with the actor
cannot be assigned on the basis of causation.162 Rather, one
must invoke normative criterion beyond causation (e.g., that the
person who threw the punch acted wrongfully). Even if it were
possible to isolate who among a pair of actors “caused” a given
loss, the libertarian faces another dilemma. Genuine cause-
based liability promises an enormous scope for tort liability (at
least in those areas not governable by contract), yet the bare
notions of act and ownership do not seem capable of setting
principled or plausible limits on that liability. Thus, the
libertarian is forced to slip into his account ad hoc limits
supposedly drawn from ordinary language or efficiency
concerns.163

B. RECIPROCITY THEORY
As the political theorist John Rawls was at the forefront of
the post-World War II revival of anti-utilitarian moral and
political theory, it is not surprising to find that his work figures
in some of the more prominent justice-based accounts of tort. A
leading application of Rawlsian political theory to tort is found
in the work of George Fletcher, later reworked by Gregory
Keating.
162 Stephen R. Perry, The Impossibility of General Strict Liability, 1 CAN. J.L. &

JUR. 147 (1988).

163 Richard W. Wright, Causation, Responsbility, Risk, Probability, Naked

Statistics and Proof: Pruning the Bramble Bush by Clarifying the Concepts, 73 IOWA
L. REV. 1001, 1015-18 (1988).

68
 1. INTERPRETIVE RECIPROCITY THEORY
As originally propounded by Fletcher, reciprocity theory’s
central claims were for the most part historical and conceptual,
rather than functional or prescriptive. Like the compensation-
deterrence theorists, Fletcher argued that, sometime around the
turn of the twentieth century, a traditional, justice-based
conception of tort law gave way to a utilitarian or instrumental
paradigm under which judges assign liability based on its
aggregate social consequences.164 Fletcher argued, however,
that, by recovering the older, justice-based conception of tort, he
could demonstrate that strict liability and negligence – regarded
by modern tort theorists as rules grounded in different
conceptions of what tort law does or should do – could instead be
seen to have once existed as complementary expressions of a
single principle of justice, which he dubbed “the principle of
reciprocity.”165
To uncover the underlying unity of the traditional common
law’s deployment of strict liability and negligence, Fletcher
distinguished two distinct situations under which harmful
conduct can arise. In the first, individuals within an identifiable
‘community of activity’ generate roughly comparable risks of
harm to one another. In the second, the conduct of one active
party poses risk of harm unilaterally on some other, inactive
parties. For tort cases arising out situations of the first type,
Fletcher argued, the traditional common law treated the
absence or presence of fault on the part of the defendant as
relevant to justice, which is why tort law governing these sorts
of cases required consideration of the defendant’s fault in
determining whether to assess liability. For that latter,
however, fault was never relevant, which is why liability in
these cases was traditionally was strict.166
A modern example of the former type of situation, in which
fault is relevant to justice, is automobile driving. Drivers who
drive carefully impose some risks on one another simply because
a certain number of collisions are unavoidable even when care is

164 George Fletcher, Fairness and Utility in Tort Theory, 85 HARV. L. REV. 537,
541-43 (1972).
165 Id. at 550.
166 Id. at 544-49.

69
taken. However, because each driver is exposed to roughly the
same degree of risk by the ordinary driving of others, an
accident caused by safe driving does not violate the principle of
reciprocity or equal risk exposure. Therefore older tort law
would have excused the driver who caused an accident while
taking due care on the ground that he acted without fault. By
contrast, those found to have driven carelessly would be subject
to liability because, unlike safe drivers, these drivers imposed an
extra quantum of risk on others above the reciprocal background
level of risk associated with safe driving, and therefore would be
required to compensate those injured by their imposition of a
non-reciprocal risk.
An example of the latter situation, in which fault is
irrelevant, is provided by the landmark case of Rylands v.
Fletcher,167 in which a landowner built a reservoir that burst
and flooded his neighbor’s mine. In that case, as well as other
familiar instances such as blasting cases, one actor imposes
risks unilaterally on the other, because its victim poses no
equivalent risks to the safety of the actor. According to Fletcher,
the absence in older tort law of a no-fault defense for injuries
arising out of these abnormally dangerous activities was simply
another expression of the principle of reciprocity, this time in a
different context. The active party is held strictly liable because
even when the actor takes due care, the imposition of risk must
be non-reciprocal simply because there is no risk being imposed
by the passive victim on the active party. Hence justice requires
the payment of compensation to the victim by the actor without
regard fault.
In this manner, Fletcher suggested, strict liability and
negligence – thought by most theorists since Holmes to be
antinomous – were at one time understood as two expressions of
a unitary principle of justice. This principle holds that each
person ought to enjoy the same degree of security from (human-
created) risks as every other person.168 Thus, a victim who is
injured because an actor exposed her to an unfair amount of risk
-- what Fletcher termed a “non-reciprocal” risk -- could, under
the traditional tort law, legitimately complain that she has

167 L.R. 3 H.L. 330 (1868).

168 Fletcher, supra note Error! Bookmark not defined., at 550.

70
suffered an injustice, and thus was entitled to compensation
from the actor who did her the injustice.

2. PRESCRIPTIVE RECIPROCITY THEORY

Fletcher was primarily concerned to recover a way of
understanding how fault and strict liability could be understood
as the manifestation of a single, historical conception of justice.
Gregory Keating has revised and updated each of Fletcher’s
central claims with an eye toward employing them in the
present.169 Thus, contrary to Fletcher, Keating asserts that the
paradigm of reciprocity is alive and well in modern tort doctrine,
although sometimes suppressed by tort scholars skeptical of
justice-based accounts of tort.170 Second, he supposes that there
are many more situations of non-reciprocity than Fletcher
originally suggested – including, for example, the manufacture
and sale of products to consumers – and hence a much greater
role for strict liability than Fletcher’s account implied. Indeed,
Keating posits that unilateral risk imposition case is so common
that strict liability ought to be the modern default rule of
liability for accidents.171 Third, because he is concerned to
advance the case for reciprocity in modern tort, Keating has paid
more attention to the normative project of justifying the
reciprocity principle as a sound principle of justice flowing from
a Rawlsian conception of fair terms of cooperation among
equals.172

3. CRITICISMS OF RECIPROCITY THEORY

As Fletcher probably would concede, to the extent it is
offered as a descriptive claim about when the law will in fact
impose liability, reciprocity theory is quite suspect. For
example, as Coleman has pointed out, while it may be that
careful drivers impose reciprocal risks on one another, they
surely do not form a community of reciprocal risks with
pedestrians (who pose almost no risks to drivers), yet tort law

169 Gregory C. Keating, Reasonableness and Rationality in Negligence Theory, 48

STAN. L. REV. 311, 313-18 (1996).
170 Gregory C. Keating, The Theory of Enterprise Liability and Common Law

Strict Liability, 54 VAND. L. REV. 1285, 1333 (2001).

171 Gregory C. Keating, Distributive and Corrective Justice in the Tort Law of

Accidents, 74 S. CAL. L. REV. 193, 200-01 (2000).

172 Keating, supra note 168, at 317-25.

71
does not hold drivers strictly liable for running down
pedestrians.173 Likewise, it would appear that, under reciprocity
theory, in an accident involving two negligent drivers that
injures one of them, the injured driver ought not to be able to
recover, as they have imposed reciprocal risks on one another.
Yet the law will permit recovery, albeit subject to a comparative
fault determination. Likewise, assuming it is the case that
exposure to second-hand smoke produces injuries in the form of
asthma attacks, bronchitis, or cancer, smokers unilaterally
expose non-smokers to the risk of injury. The law, however,
does not hold them strictly liable for that conduct.
Prescriptive reciprocity theory has been criticized on a
number of grounds. Some critiques have focused on the
elusiveness of the idea of reciprocity.174 One also might worry
that reciprocity theory vacillates between an empirical
conception of reciprocity (the statistical amount and degree of
risk individuals expose to each other) and a normative
conception of reciprocity (the degree and type of risk that one
ought to be permitted to impose on others). It is also difficult to
identify in a principled manner the relevant “community of risk”
within which conduct is taking place, and hence whether
reciprocity demands the application of strict liability or
negligence. For example, to the extent consumers are also
shareholders in manufacturing companies, can it be said that
each simultaneous is at risk of product injury and imposes such
risks on others? If so, is this a situation of reciprocal risk
creation?175

C. CORRECTIVE JUSTICE THEORY

A third and broad camp within individual justice tort
theory takes its cue from the commonplace that tort law seeks to
restore the injured plaintiff to the status quo ante. On this
view, tort law is understood as aiming to restore an equilibrium
that has been disturbed by the tortfeasor’s conduct. A wrong

173 Jules L. Coleman, Justice and Reciprocity in Tort Theory, 14 W. ONT. L. REV.
105, 112 (1975).
174 Id. at 117 (noting that reciprocity is consistent with a regime that maximally

restricts liberty in the name of security); cf. Goldberg, supra note 14, at 1853-56
(questioning whether it is helpful to reduce the various wrongs of tort to a notion of
reciprocity or reasonableness).
175 Thanks to Bob Rasmussen for this observation.

72
has been done and a “mess” has already been distributed: it has
landed in the lap of a victim, who, prior to the operation of the
law, holds it in its entirety.176 If we assume that the victim is
innocent, the question tort law seeks to answer is: Is there a
person (or persons) whose normative connection to the mess
currently borne by the victim warrants that it be shifted to that
person (or those persons)? In contrast to enterprise liability
theory, the aim of re-allocating the loss is not to spread it widely
enough so that no one feels its pain. Rather, it is to identify
whether there is another person whose relationship to the mess
generates a duty on his part to clean it up. If so, tort law
“corrects” the injustice -- restores the pre-existing equilibrium --
by order that the full value of the loss be transferred to the
responsible party via a damage payment equal to the value of
the loss.177
The writings of Weinrib, Coleman, Perry, and Ripstein,
although they differ along various dimensions, each fit within
this general description. Each supposes that persons owe
certain primary duties not to cause certain kinds of injuries to
others; for example, duties not to intentional cause physically
injury to another, or to take reasonable care not to cause
physical injury to another. The law responds to those breaches
of primary duties that cause injuries to others by generating
secondary duties to repair the losses flowing from those
breaches. Tort law, on this view, aims both to specify the
primary duties actors owe to one another, and to provide a
vehicle by which the secondary duty to repair is enforced.

1. INTERPRETIVE CORRECTIVE JUSTICE THEORY

In all its variants, corrective justice theory is almost purely
interpretive and, even beyond that, to a large degree formal or
structural. Its main goal is to provide a rational reconstruction
of what it is that a system of law with the particular features of
176 Jules L. Coleman, Second Thoughts and Other First Impressions, in

ANALYZING LAW 257, 302 (Brian Bix ed., 1998).

177 The notion of restoring equilibrium, and the term “corrective justice,” are

frequently traced to Aristotle, who distinguished corrective from distributive justice.

Aristotle described the former as concerned to erase the “gain” a wrongful actor
obtains by acting wrongfully, and the corresponding “loss” suffered by the wrongful
actor’s victim, by means of a payment from wrongdoer to victim that simultaneously
eliminates the “gain” and restores what has been “lost.” See, e.g., Stephen R. Perry,
The Moral Foundations of Tort Law, 77 IOWA L. REV. 449, 453 (1992).

73
Anglo-American tort law -- plaintiff-initiated law suits, claims
against particular, allegedly responsible parties, the
requirement of proof of causation, the award of compensatory
damage payments – might be accomplishing. As such,
corrective justice theory is mainly devoted to demonstrating --
contra the other major tort theories -- that the basic features of
tort law are not a mere historical byproduct, nor a convenient
means of achieving deterrence or compensation, but instead a
system designed for the goal of correcting private injustices by
transferring wrongful losses to a wrongdoer who caused them.
While there is general agreement on this theoretical
objective, there are important internecine disputes within
corrective justice theory, two of which may be noted here. First,
there is the question of whether corrective justice is best
conceived of as responding to the actor’s “wrongful conduct”
itself, or instead to the “wrongful loss” caused by the actor’s
misconduct. Coleman takes the latter view. Tort, he argues,
begins with a loss that innocent victim V does not deserve to
bear. This in itself, however, is not enough to establish that
some other person or entity ought to bear it. If, for example, V’s
loss owes to her having been victimized by a hurricane, there is
no particular reason to saddle another person with it. What’s
needed is an account of the conditions under which at least one
other person (call him W) can be said to have a particular reason
to bear V’s loss beyond simply their shared common humanity or
citizenship.178
According to Coleman, two conditions must be met before
such a re-assignment can occur. First, and most fundamentally,
V must show that somebody else has acted wrongfully. It is only
the class of wrongdoers, in other words, who are even eligible as
potential bearers of V’s loss. If there were no wrongdoers in the
world, there would be no reason in corrective justice to transfer
V’s loss to anybody else. Second, to complete the case for the
loss transfer, V must further show that one or more members of
the class of wrongdoers in fact caused her loss. If V can show a
causal linkage exists between the conduct of W, a wrongdoer,
and her loss, V establishes that W has a special reason to take
on the burden of V’s loss and correct it by means of a
compensatory payment. On this view, W’s having done wrong
178 COLEMAN, supra note 59, at 326.

74
renders her eligible as one of the persons who might incur a
duty to compensate V for her losses, but that eligibility is only
converted to liability if W happens to cause a loss to V.179
Weinrib has criticized Coleman’s wrongful loss version of
corrective justice on the grounds that it drives too sharp a wedge
between causation and wrongdoing.180 Suppose V is injured
when W rams her car into V as she rides her bike. Suppose
further that W has incurred three speeding tickets in the last
year and that her speeding constituted wrongful conduct.
Finally, suppose that W is not speeding or otherwise driving
carelessly on the occasion when she strikes V’s bike. On
Coleman’s theory, it would appear that W incurs a duty to repair
V’s losses because W has done wrong (by speeding in other
instances) and has caused V’s loss. The fact that W’s wrongful
conduct was not the conduct that caused the loss -- a basic
requirement under black-letter negligence law -- is not captured
by Coleman’s criteria for loss-correction.
This sort of example tells us, according to Weinrib, that
Coleman is too loose in characterizing corrective justice as
concerned with the rectification of “wrongful losses.” Instead, he
argues, it is concerned to rectify the wrongs themselves. Tort
law does not impose liability on W in the car-bike scenario
precisely because V cannot establish that her injuries flow from
W having wronged her. According to Weinrib, a primary
doctrinal illustration of his point is Cardozo’s majority opinion in
Palsgraf v. Long Island R.R.181 Mrs. Palsgraf was injured by
wrongful conduct on the part of the railroad’s conductors, but
nothing they did was wrongful to her. To be sure, their conduct
was wrongful to the people standing next to the passenger whom
they assisted in boarding the moving train – those people were
subjected to a foreseeable risk of physical injury by the
conductors’ conduct. Mrs. Palsgraf, “standing far away,” was not
wronged because nothing in the situation warned the conductors

179 Id.
180 Ernest J. Weinrib, Non-Relational Relationships: A Note on Coleman’s New
Theory, 77 IOWA L. REV. 445, 447 (1992).
181 162 N.E. 99 (N.Y. 1928); WEINRIB, supra note 123, at 159-64. Professor
Zipursky connects Palsgraf to a broader ‘proper plaintiff’ requirement that operates
throughout tort law, and suggests, contra Weinrib, that this facet of tort is captured
better by a theory of civil recourse than corrective justice. See Benjamin C. Zipursky,
Rights, Wrongs and Recourse in the Law of Torts, 51 VAND. L. REV. 1, 3, 70-93 (1998).

75
that, if they assisted the passenger in boarding the train, they
ran the risk of injuring her. Thus, Cardozo’s opinion rightly
denies liability. Because Mrs. Palsgraf was not herself wronged
by the railroad, she was not entitled to prevail in a negligence
action, which empowers only those who are wronged to seek
rectification (in the form of a compensatory payment) from their
wrongdoers.
In response, Coleman and Perry have both pressed Weinrib
in another direction. Suppose Weinrib’s view does better
capture than Coleman’s the sort of corrective justice instantiated
in current tort doctrine. Still, they argue, it fails to explain
perhaps the most basic feature of tort law: namely the
compensatory, “make-whole” payment. If the principle of tort is
expressed in the idea of rectifying wrongs, why does that
rectification take the form of payment of compensation, rather
than apology, punishment, community service, or the like?182
Weinrib cannot explain, they argue, how rectification of the
wrong translates into compensating for the losses flowing from
the wrong.
A second debate within corrective justice theory, one that
cuts across the first one, concerns the respective roles played by
notions of responsibility and fairness in determining when the
duty of repair will attach. Like Coleman, Perry believes that
corrective justice theory proceeds by first identifying the
universe of persons or entities to whom the innocent victim’s
loss might be shifted. In his view, however, that first cut is
accomplished by means of an “attributive” principle of
responsibility.183 Borrowing from Honore, Perry argues that
the universe of potentially liable parties is defined by a notion of
“outcome responsibility”, which holds roughly as follows: when
one undertakes acts in a situation where harm to another is a
foreseeable outcome of those acts, one incurs certain
responsibilities if that harm is realized simply because the harm
was avoidable (if only by the decision not to undertake the act).
To say that the causation of avoidable harms generates some
notion of responsibility, however, is not to endorse a regime of
strict liability, for the nature of the responsibilities that one may
incur range considerably in terms of their demandingness and

182 Perry, supra note 176, at 480.

183 Id. at 496-97.

76
legal enforceability depending on the circumstances that
brought about the harm. A person whose faultless conduct
causally and foreseeably contributes to an accident, for example,
may incur nothing more than a responsibility to apologize, or to
make an effort to summon aid. The remaining move, then, is to
specify the circumstances under which one or more outcome-
responsible agents can be said to have incurred the particular
secondary duty of repairing the harms they have helped to
cause. It is the identification of those circumstances that will
permit the re-allocation of the victim’s loss to some or all of the
candidates identified as “outcome-responsible.” According to
Perry, these further circumstances are specified by the familiar
contours of tort doctrine, which imposes liability on actors who
cause harm through certain intentional, reckless and negligent
misconduct. Thus, for example, in a universe of outcome-
responsible actors consisting of only two persons – an at-fault
defendant and an innocent plaintiff – the loss is allocated to the
at-fault actor.184
Coleman rejects the notion that the universe of candidates
normatively eligible for taking on the loss of another can be
defined by an independent attributive principle of responsibility.
A non-controversial principle of attribution, he argues, would
have to be so broad that it could not do any work in limiting the
universe of possible loss bearers.185 Rather, it is an allocative
notion of fairness that does all the work in determining who
should bear the cost of a given loss. Fairness, in other words,
determines who is eligible to take on a duty to repair. Thus, one
does not begin by asking who among all persons bears the right
sort of connection to a bad outcome, and then winnow that field
by determining who among these persons acted with intent, or
recklessness, or fault. Rather, one seeks to identify who might
bear the loss precisely by asking whether the actor acted in a
manner that distinguishes him from the general population in
the relevant way. For example, an actor’s having failed to act as
a reasonable person (fault) renders him eligible to take on
another’s loss. It is a reason to do so because to act at fault,

184 Id. at 499.

COLEMAN, supra note 129, at 51. For Perry’s response, see Stephen R. Perry,
185

The Distributive Turn: Mischief, Misfortune and Tort Law, in ANALYZING LAW, supra
note 175, at 141, 150-51.

77
suitably understood, means to have acted unfairly toward other
persons.

2. PRESCRIPTIVE CORRECTIVE JUSTICE THEORY

Given its focus on rationally reconstructing the deep
structure of tort doctrine, corrective justice theory has remained
thin in its prescriptive dimension. Weinrib presents an extreme
version of this disposition by asserting, quite deliberately, that
tort law should not be understood or defended in terms of its
purposes.186 Less stringently, Coleman expresses agnosticism.
His scholarly agenda in tort theory, he maintains, is only to
suggest that the practice of tort law is intelligible, not that it is
justifiable.187 Ripstein argues, in some ways building on
Fletcher, that corrective justice is an expression of an
underlying Rawlsian principle of fairness or equality.188 Yet
even he maintains that a scheme of corrective justice is, at most,
consistent with fairness, leaving open the possibility that
fairness would be satisfied at least as well, if not better, by a
New Zealand style accident fund, paid for out of general tax
revenues.189 In Coleman and Ripstein, at least, this
circumspection in making a prescriptive case for corrective
justice reflects a concern that the pursuit of corrective justice
can reinforce distributive injustice. Precisely because it restores
the status quo ante, tort law operates to reinstate existing
distributions of wealth. To update Coleman’s example; under
basic principles of tort law, a poor person who negligently drives
his car into Bill Gates’s Rolls-Royce is required to compensate
Gates for the damage, notwithstanding the enormous, and
possibly unjust, disparities in their incomes.190

186 Goldberg, supra note 19, at [Unloved].

187 Id.
188 ARTHUR RIPSTEIN, supra note 59, at 2. Ripstein’s work straddles my
categories of reciprocity and corrective justice theories. Perry maintains that Ripstein
(and Coleman), although nominally corrective justice theorists, are in substance
Rawlsian reciprocity theorists because the criterion they imply for determining when
the secondary duty to compensate arises is one of distributive rather than corrective
justice. Thus, although they are concerned to set out the circumstances under which
one person (D) incurs a ‘duty’ to compensate another (P), on his view they end up
concluding that D should compensate P whenever distributive justice demands that
resources be shifted from D to P. See Perry, supra note 185.
189 Id. at 20 n.24.
190 COLEMAN, supra note 59, at 304.

78
 3. CRITICISMS OF CORRECTIVE JUSTICE THEORY
Corrective justice theory has been accused by other tort
theorists of being irrelevant to modern tort law, banal in its
substance, and fundamentally misguided in not aspiring to offer
a ‘functional’ account of tort law. None of these criticisms is
particularly well taken.
The first contention has already been addressed above, in
connection with the compensation-deterrence theorists’ claim
that respondeat superior and liability insurance have rendered
notions of corrective justice irrelevant to modern tort law.191 As
to the second, it is true that corrective justice is mostly
concerned with making sense of the institutional structure of
tort law, rather than with particular tort doctrines. But this
hardly renders it banal. as Coleman has noted, just as it tells us
something potentially significant about criminal law to conceive
of it as a system designed to achieve retributive justice, so it
says something potentially significant about tort to conceive of it
as a system for achieving corrective justice.192 This is
particularly so given the inability of the other major theories to
make much sense of the institution of tort law as it presently
stands.
Finally, the accusation that corrective justice theory is
“formal” rather than “functional” rests on a confusion. Some
versions of corrective justice theory, as well as other tort
theories, resist the claim that the best way to understand or
apply the law of torts is by treating each of its concepts and
doctrines solely in terms of the function they perform.193 But
this is not to say that these concepts, and tort law generally,
have no point or purpose. The ‘point’ of tort law on corrective
justice accounts is to deliver justice. It is presumably intelligible

191 See supra text accompanying note 56.

192 COLEMAN, supra note 129, at 33; Goldberg & Zipursky, supra note 6464, at
[Unrealized Torts].
193 See Coleman, supra note 129, at 13-24 (arguing for a non-functional

understanding of the meaning of key tort concepts). For a philosophical defense of an

anti-instrumentalist account of legal concepts, see Benjamin C. Zipursky, Pragmatic
Conceptualism, 6 LEGAL THEORY 4 (2000). For an application, see John C. P. Goldberg
& Benjamin C. Zipursky, Concern for Cause: A Comment on the Twerski-Sebok Plan
for Administering Negligent Marketing Claims against Gun Manufacturers, 32 CONN.
L. REV. 1411, 1420 (2000) (arguing that the cause-in-fact requirement should not be
treated purely instrumentally, i.e., as “a tool to be placed back in the tool box when it
no longer helps attain the ends of deterrence and compensation.”).

79
-- although not uncontroversial -- to ascribe to American
constitutional law the “function” of promoting individual rights,
or a just system of government. No less intelligibility attaches
to a claim that the purpose of the institutions, rules and
concepts that make up tort law is to correct injustices visited on
individual citizens by other citizens or government officials. Of
course, if one assumes that the only theories of tort which count
as making functional claims are theories that explain tort in
terms of its ability to deliver some aggregate social good, such as
the maximization of utility, then it would follow that corrective
justice explanations of the tort system are not functional or
pragmatic. But, absent a defense of the initial supposition, this
argument rests on pure fiat. We need to know why one ought to
restrict the definition of “functional” in this way. Few, if any of
corrective justice theory’s critics have attempted to provide that
explanation, and those that have tend to invoke as self-evident
what are in reality arguments for a form of utilitarianism.194
To argue that the foregoing criticisms of corrective justice
theory miss the mark is not to suggest, however, that it is
immune from critique. First, corrective justice theory’s
emphasis on structure and formalities, though not objectionable
for banality, is more objectionable when understood as a failure
to explain what, if anything, corrective justice theory has to say
about tortious wrongdoing. As Coleman admits, the concept of
“wrong” is a placeholder standing in the middle of corrective
justice theory, and needs explication.195
Second, even as structural theory, corrective justice runs
into difficulties. In particular, the notions of “correcting an
injustice,” or “cleaning up a mess,” suggest that the key feature
of tort is the restoration of a pre-existing equilibrium via a full
compensatory payment. This creates several problems at the
interpretive level. For example, it renders the well-established
institution of punitive damages problematic.196 More
fundamentally, the picture of tort law as restoring a balance
rings false.197 Tort suits cannot in fact cancel out wrongs, nor do
they typically make the plaintiff whole in any meaningful
194 Goldberg & Zipursky, supra note 16, at 1807-12.
195 Jules L. Coleman, The Practice of Corrective Justice, in PHILOSOPHICAL
FOUNDATIONS OF TORT LAW, supra note 66, at 53, 57-58.
196 WEINRIB, supra note 120, at 135 n.25.
197 Goldberg, supra note 14, at 1852-53.

80
sense.198 In short, they do not return the world to a pre-existing
equilibrium. Instead, they provide “satisfaction,” a term that
carries connotations of vengeance on the part of the victim.199 A
personal injury complaint, for example, does not simply ask of
the defendant that he fix what he has broken or replace what he
has taken. The commission of the tort has unalterably changed
the world by creating a person who is now and will forever be
the victim of a wrong. The complaint seeks not to ‘undo’ or
‘restore,’ but to satisfy the victim not only for her losses, but for
the victimization itself.
Third, although it is usually offered as an interpretation of
the “deep structure” or “practice” of tort law – in particular, as
providing an explanation for why tort operates in terms of P v. D
lawsuits -- corrective justice theory has not adequately specified
its interpretive methodology. For example, a central
distinguishing feature of American as opposed to commonwealth
tort practice is the civil jury. Does corrective justice theory
regard itself as obligated to account for that important feature of
American practice? If so, what is that account? If not, on what
grounds is it to be excluded as not central to the structure or
practice of tort law?200
Fourth, corrective justice theory is arguably too narrowly-
focused on the moral issue of whether and when an actor incurs
the responsibility to repair, and insufficiently focused on the
political theory issue of why the legal system provides a
particular sort of apparatus for enforcing such responsibilities.
Corrective justice theorists, in other words, focus
asymmetrically on the defendant’s obligations, and thereby fail
to attend to the way in which the legal system specifies the role
of the plaintiff who seeks redress on the basis of such
obligations. If tort aims to assign responsibility to wrongdoers
or for wrongfully caused losses, why is set up so as to leave
enforcement of those responsibilities optional with the plaintiff?
Why should plaintiff get to determine when this class of citizens’
moral responsibilities will be enforced or not?. In not attending

198See Professor Pryor’s contribution to this symposium.

199 See Goldberg & Zipursky, supra note63, at _____ (conceptualizing tort as law-
governed recourse).
200 Hetcher, supra note 125, at . But see Catherine Wells, Tort Law as
Corrective Justice: A Pragmatic Justification for Jury Adjudication, 88 MICH. L. REV.
2348, 2402-10 (1990).

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to the particular way in which tort law empowers (but does not
require) plaintiffs to sue on the basis of obligations owed to them
by defendants, corrective justice theory seemingly provides only
a half-complete account of the practice of tort law.201
Fifth, to the extent modern legal actors, including lawyers
and judges, tend to conceive of tort law more along the lines of
compensation-deterrence, enterprise liability, economic
deterrence, or social-justice theory, the less likely it is that tort
practice will conform to a conception of corrective justice. Thus,
for example, the more willing courts are to flat-out abandon
proof of causation as an element of a claim for negligence, or to
treat loss-spreading as a sufficient rationale to impose liability,
the less will it be the case that tort law conforms to corrective
justice theory. This, of course, is not to say that corrective
justice is committed to a static conception of tort. Often
particular adjustments in the law, such as the adoption of
market share liability, or “loss of chance” doctrine, can be
accounted for within a corrective justice framework.202 Still,
radical innovations in tort risk rendering at least certain aspects
of the institution of tort no longer amenable to a corrective
justice interpretation.
Sixth, corrective justice theorists are obligated to offer some
account of the interrelationship of justice to other
considerations, including those of social welfare. Are judges, for
example, ever entitled to deny causes of action on policy
grounds. Even if the aim of tort law is to permit victims of
wrongdoing to undo those wrongs, are there pragmatic limits on
that enterprise? Or must justice be done, though the heavens
will fall?203
Finally, at the prescriptive level, the agnosticism of
corrective justice theorists, while intelligible, may ultimately
prove problematic. If all that can be said in defense of tort law
is that it is intelligible, is tort law a practice that we ought to
endorse? Some corrective justice theorists, at least, seem no less

201 Benjamin C. Zipursky, Civil Recourse, Not Corrective Justice, ___ GEO. L.J.
___ (2002) (in this symposium)
202 Arthur Ripstein & Benjamin C. Zipursky, Corrective Justice in An Age of

Mass Torts, in PHILOSOPHY AND THE LAW OF TORTS, supra note 120, at 214, 231-44
(arguing that some forms of market share liability are compatible with corrective
justice theory).
203 Goldberg & Zipursky, supra note 63, at 718-23.

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anxious than enterprise liability theorists for a post-tort world of
regulation and insurance. Few have ventured to explain why
corrective justice is a necessary or even important feature of a
modern legal system.204

CONCLUSION
Having endured the foregoing guided tour, the reader may
justifiably ask what one is to make of it. Four plausible answers
come to mind. None seems entirely satisfactory.
The first and most cynical response is to see in the
foregoing a demonstration that theorizing gets lawyers and
scholars nowhere, and that we would be best off not doing it.
Instead, we should just get on with the business of analyzing
concrete problems undistracted by theoretical disputes that have
no answer and no point. A second reply might come in the form
of a demand for more information: these disputes tell us that we
will never get anywhere until we have more facts about how tort
law actually works in practice. Until we know more about the
deterrent effect of rules, for example, we can’t settle the basic
dispute between enterprise liability theory and economic
deterrence theory.
A third reply asserts that we should be content to take
whatever edification can be found here. Theory does not guide
us in our actions – it is not pragmatic in that way. However, it
expands our horizons, helps us to see alternative constructions
of the phenomenon of tort law, and thus leaves us with an
enriched sense of the possible. Fourth and finally, one might
adopt a stance of congenial pluralism. Tort law is a multi-
faceted enterprise, so it is no surprise to see that each theory
brings something to the table: each, as it were, highlights factors
that matter to tort law, and we should embrace them all. This
response, although similar to the third, is somewhat more
ambitious. It presumes that theory not only expands lawyers’
horizons, but can and should inform lawyerly arguments about
particular problems in tort law. It simply suggests that
different theoretical insights ought to be brought to bear
differently in different contexts.

204 Goldberg, supra note 19, at . Ripstein is perhaps the exception. See supra

note 186.

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 The first reply should be resisted because it inevitably sows
disingenuousness. It might be possible simply to treat each tort
case as sui generis, but every lawyer and academic who has
occasion to think about such cases is invited to invoke ideas or
assumptions as to what, more generally, can or should be said
about the subject. Arguing about tort cases inevitably draws
one into arguments about tort. If, in the course of arguing about
a tort issue or case, a lawyer explicitly or tacitly invokes the idea
that liability should (or should not) attach because it does (or
does not) promote “deterrence and compensation,” she is taking
a stand on what the function of tort law is or ought to be. In
short, disavowals of theory usually amount to sub rosa
invocations of particular theories.
The call for data elicited in the imagined second response is
worth heeding. We do need to know more about the deterrent
effects of tort law as well as innumerable other facts bearing on
the tort system. If it turns out that actors are not often
responsive to tort sanctions, then we have learned something
about what tort law is likely to achieve as a matter of theory, or
what it would have to look like in order to achieve goals such as
deterrence. Likewise, one would want to be able to measure the
respective administrative costs of negligence and strict liability
regimes as a way of helping to settle the dispute over one of the
longstanding questions in analytic economics. Yet, even putting
aside the difficulties in designing the relevant studies and
coming up with accurate measures of these sorts of nebulous
phenomena, careful collection and interpretation of data,
although vital, will only get us so far. Legal theories, no less
than political theories, are resistant to falsification: in the face
of seemingly disconfirming data, auxiliary hypotheses can be
invoked, assumptions modified. (Nowhere is this more apparent
than in the Landes and Posner version of economic
interpretivism.) To some, this feature of theorizing provides
grounds for condemning the whole enterprise of theorizing.
More temperately, one might simply doubt that theoretical
disputes will find their final resolution in observation.
The third response envisioned above is also appealing on its
face. It is edifying to learn of the various ways in which
theorists of tort have conceptualized their subject. Yet jurists
face the task of making arguments pointing toward practical

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conclusions. In law, theory is important not merely as an eye-
opener: it is also an important part of practical judgment and
decision-making. Perhaps we can aspire to no more than a
never-ending “conversation” among jurists who are self-
consciously aware of the positions they articulate, but that is a
somewhat modest ambition for so practical a discipline as law.
Finally, what of the fourth response, which sees this sort
of Article as making the case for congenial, live-and-let-live,
theory-pluralism? Such a tolerant conclusion cannot but attract
many modern American lawyers. Still, at the risk of being
intolerant, I want to resist it. Much depends, however, on who
is drawing this lesson from the foregoing analysis, and for what
purpose. Let us consider, first, the plea for pluralism as
addressed to judges who handle tort cases, then turn to consider
its applicability to scholars of tort.
Congenial pluralism is most useful as an antidote to
judicial monomania. So, if the judiciary were filled with judges
who tended to be guided in their decisions by the dictates of a
particular prescriptive theory of tort -- imagine a cadre of judges
who determined all legal issues in tort cases by asking what
result was dictated by libertarian or Rawlsian theory -- one
would certainly welcome an effort on the part of legal academics
to get them to recognize other theories, if only to suggest that
the judges’ chosen mode of decision-making is practically and
normatively problematic.
But if congenial pluralism can serve as an antidote to this
particular diseased version of adjudication, it promises little else
by way of cure, and nothing by way of positive advice for
proceeding healthfully. Part of the problem is that the various
tort theories often entail opposing interpretations and
prescriptions. A corrective justice theorist’s account of what the
legal concept of fault means, or the function it performs, is quite
different from -- and sometimes incompatible in application
with -- the account of fault offered by the interpretive economist.
Likewise, a prescriptive enterprise liability theorist has a very
different account of what tort law should look like and do than a
social-justice theorist.
Given conflicts such as these, the congenial pluralist’s
mantra -- “recognize all theories, cast judgment on none ” -- can
only be sustained in one of two ways. First, one could identify a

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set of meta-principles to resolve first-order conflicts by
establishing when the considerations brought to bear by one
theory ought to apply and trump those of others. Unfortunately,
no such principles have been developed. The alternative, then,
is to leave judges with the message that it is their job to exercise
judgment by achieving an ineffable balance among diverse and
sometimes antithetical considerations with respect to any given
decision.
Here, finally, we reach a basic issue in modern
jurisprudence. Must we or ought we concede that all we can say
of any given tort decision, or any given tort doctrine, is that, if
well-rendered, it will reflect the attainment of an unarticulated
and unarticulable balance among various considerations --
including some that are diametrically opposed? I suggest that,
to make such a concession, is to give up on the idea of law. Of
course some modern legal academics are content to do so. Still, I
would conjecture that most lawyers and citizens believe, with
Cardozo, that adjudication should not consist simply of a series
of “isolated dooms.”205 Rather, they expect that the law aspire to
coherence; a demand rooted in elemental notions of fairness,
predictability and efficacy.206
So, on one mainstream but contestable account of
adjudication, what we want from our judges is not ad hoc or
metaphorical balancing, but decisions that form and reform a
relatively coherent collection of rules and principles that, taken
together, constitute “tort law.” In order for that to happen,
however, judges must have some sense that that is what they
are doing – they need to see themselves as part of an
undertaking that aspires toward intelligibility and coherence.
To the extent interpretive theories, such as interpretive
economic deterrence theory and enterprise liability theory, offer
implausible accounts of the tort law that we have, they have
weak claims to judicial allegiance.207 The establishment of an
efficient level of precaution-taking is not a plausible principle to

205 BENJAMIN N. CARDOZO, THE NATURE OF THE JUDICIAL PROCESS 126 (1921).
206 Needless to say, a defense of these claims is beyond the scope of this already
long Article. For some thoughts on the connection between coherence and fairness,
see John C. P. Goldberg, Note: Community and The Common Law Judge:
Reconstructing Cardozo’s Theoretical Writings, 65 N.Y.U. L. REV. 1324, 1334-42,
1350-52 (1990).
207 Whether they ought to influence legislative activity is a different issue.

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attribute to our tort law, nor is the dispensation of need-based
disaster relief. Indeed, as prescriptive theorists in these camps
tend to acknowledge, the tort system is no more than a second-
best (if not third- or fourth-best) mechanism for achieving these
goals. To be sure, judges sometimes have the opportunity and
power to advance these goals in the course of presiding over tort
cases. But when they do so purposefully, they are not applying
and developing the law of tort, but departing from it.208
What is needed then, and what we do not find in twentieth
century tort theory, is a theory that really is grounded in the law
of tort -- one that makes as much sense as can be made of the
practices and principles of tort law as we find it. Of the theories
surveyed, corrective justice theory comes closest to that goal.
Unfortunately, it operates at such a high level of abstraction as
to offer not so much a theory of tort, as a theory of the structure
or form of tort. Even then it has not yet offered a fully adequate
account of that structure.
Let me conclude by briefly turning from judges to tort
scholars. As with respect to judges, congenial pluralism is
surely appropriate as an antidote to dogmatism. Unfortunately,
it leaves us in the academy with nothing more to do than to talk
past one another. Might we do a little bit better than that? I
would suggest that the foregoing discussion suggests certain
methodological guidelines from which theorists of tort might
benefit as they go about the business of theorizing the “new
negligence” and, more generally, the new tort law of this
century. These are not offered as ineluctable or self-evident
postulates for clear thinking about tort. Rather, they are
suggested as practical measures that might help improve
academic discourse in this area.

• Distrust disavowals of theory; no influential tort

scholar of the last century could legitimately claim to
have eschewed theory in favor of what is ‘merely’
practical, useful, pragmatic, or realistic. There is no

208 My claim that judges would do well to approach tort cases with a sense that

tort is a more or less coherent body of law is not equivalent to a claim that judges
should rigidly adhere to precedent or refrain from reformulating law. Often enough
reformulation is necessary to maintain the law’s coherence. See Goldberg, supra note
206, at 1348-54 (noting Cardozo’s appreciation for the fact that law must evolve with
changes in social circumstances and social norms).

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 reason to think the scholarship of the next century will
differ in this regard.

• Distinguish theories that aim to interpret tort law from

those that offer prescriptive accounts, whether
hypothetical or categorical. If the issue concerns
interpretation, assess what kind of interpretive claims are
being made: historical, conceptual, functional, or other.209

• Resist the temptation to characterize disputes between

tort theories as a fight between theories that posit a
purpose or function for tort law and theories that do not.
Some theories are entirely instrumental, whereas other
leave room for concepts that are not reducible in any
simply way to functional considerations. Still, all the
theories presented here posit a pragmatic point to tort
law. None, for example, explain or defend tort in terms of
its beauty or elegance.

• Distinguish between a theory’s account of the

‘purpose(s)’ or aim(s) of tort law, on the one hand, and its
incidental effects on the other. A corrective justice
theorist, for example, might suppose that ‘point’ of tort
law is to do justice between the parties, yet still
acknowledge that the effect(s) of tort law sometimes
include the deterrence of misconduct or the compensation
of needy victims.

• Recognize that the domain of tort theory is not

exhausted by a two-sided fight between economic theories
and justice-based theories. The last century witnessed, as
we have seen, at least a five-way battle and, as noted
above, I have not tried to be comprehensive in my
catalogue of tort theories. Moreover, even those theories
identified as “economic” and “justice” theories have varied
widely in the type of claims they make.

209As suggested above, my claim is not that these categories have some special
epistemological status, nor that they are airtight with respect to one another. See
supra note 5. I merely claim that they provide useful heuristics or guidelines for
analyzing theoretical claims about tort law.

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 These suggestions, I hope, will help scholars avoid some of
the confusions of twentieth-century tort theory, and promote
more charitable understandings of the different positions
within this corner of the academy. Perhaps they might even
lead to theoretical advance. They ought to be taken, however,
in conjunction with a different sort of caution, one that consists
not of a plea for methodological improvement but instead
suggests a shift in perspective.
As indicated in the Introduction, the project of twentieth
century tort theory was launched by the industrial revolution,
and has for the most part continued to bear that birthmark.
To Holmes and those who followed in his footsteps, tort law
was the law of mechanized accidents. On their view, the
classical account, born of a pre-industrial era, had nothing to
say on the pressing policy question of whether these accidents
would be governed by a standard of strict liability or
negligence. Even corrective justice theorists, who in some
ways are more sympathetic to the classical account, have
drunk deeply from the Holmesian well. Thus, they, too, have
tended to focus on the law of accidents and the question of
strict liability versus negligence.
Prediction is a hazardous business, particularly when
undertaken by a law professor. Still, one may speculate that,
in the near term, mechanized accidents will cease to provide
the focal point of tort. Even in the heartland of modern
accident law – products liability – one already sees a relative
increase in claims grounded in failure to warn and inform, as
well as misrepresentation. These are not the mechanical
manglings around which Holmes organized tort theory.
Moreover, at least as alleged, they involve culpable acts rather
than inevitable accidents nor difficult cost-benefit judgments
about design safety. In short, the post-industrial revolution
may soon pose to the Holmesian project the same risk of
obsolesence that the industrial revolution posed to the classical
account.210 Thus, it is quite possible that tort theorists soon
210 The current Draft Third Restatement purports to restate the “general

principles” of tort law as it applies to physical harms, yet confines itself almost
entirely to “accidental personal injury and property damage” and then excludes from
even that narrow definition the subjects of premises liability, malpractice, and
affirmative duties. RESTATEMENT (THIRD), supra note , at xxi; see Goldberg &

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will be required to provide not just theories of tort law qua
accident law, but comprehensive and comprehending theories
of tort, theories that see the “new negligence” as part of a
multi-faceted yet broadly coherent law of wrongs. Ironically,
the traditional account might provide a promising starting
point for such efforts.

Zipursky, supra note 65, at 675-77 (noting oddity of Reporters’ claim that the Draft
contains “general principles” yet excludes substantial areas or tort law). For an
argument that the Third Restatement is simply seeing through Holmes’s original
project, see Thomas C. Grey, Accidental Torts, 54 VAND. L. REV. 1225 (2001). Grey
offers this analysis in part to establish that the Draft Restatement represents the
orthodox modern view on torts. Time will tell, but it just as likely may prove to be the
swan song of Twentieth Century Tort Theory.

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