The Economics -- Conventional, Behavioral, and Political -- of

Abstract

Eonomic analyses of evidence law have proliferated in recent years. This paper criticizes the economic justifications that have been advanced on behalf of one rule in particular: the ban on proof of "subsequent remedial measures" (SRM) to suggest inadequate precautions were taken before an accident. The conventional economic defense of this rule?that allowing SRM proofs discourages parties from taking steps ex post to prevent recur rence of accidents?ignores the negative effect that banning SRM evidence has on incentives to take care ex ante. The behavioral economic rationale? that factfinders will overvalue SRM proofs because of "hindsight bias "? fails to weigh the risk of erroneous imposition of liability when such evidence is admitted against the risk of erroneous nonimposition of liability when it is excluded. Rather than a categorical ban, economic analysis supports a case by-case evaluation of whether SRM proofs should be admitted in light of the strength of the remaining evidence in the case. The uneven enforcement of the SRM ban often noted by commentators can in fact be defended on these grounds. The scholarly defense of a categorical ban, this Essay concludes, reflects a decidedly unempi?cal (and necessarily conservative) style of eco nomic analysis that seeks to win assent by showing that it can rationalize existing legal rules. This form of law and economics is singularly unsuited for the analysis of evidence because it exacerbates the tendency of undesirable rules of proof to perpetuate themselves through the effect they have in shaping popular beliefs about how the world works.