Institutions are so afraid of liability that it's usually impossible to do *anything*
Reasonable fear of reasonable liability Excess fear of reasonable liab Excess fear of unreasonable liab Reasonable fear of unreas liab
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The first of these leads to reasonable precautions. The second is normal risk aversion, but still suboptimal
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(. 0001% chance of something happening, but all anyone thinks is omg liability, what will happen to the insurance rates).
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Third is normally purely imagined liability, enabled by stories of frivolous cases. Fourth is reasonable fear of frivolous or dumb
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cases that the law is poorly equipped to deal with--paralyzation due to systemic flaws.
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True sovereignty eliminates most of these inefficiencies, at the cost of making externalities harder to deal with.
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No interest in this topic?
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@HbdNrx I rage when I see 2 and 4 play out. This risk should be managed @ level of shareholder portfolios. -
@AngloRemnant 4 makes me pissed at the justice system, but I encounter 3 all the goddamn time, and it makes me pissed at the people involved -
@AngloRemnant I'd say 3 is overall the most common. Imaginary fears over hypothetical dumb lawsuits -
@AngloRemnant#s 3 and 4 together also cover things like sexual harassment law and other things that dramatically influence corp culture -
@HbdNrx Yes, and classic Agency problem incentivises Corp legal & HR to cover their asses at the expense of shareholder value.
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