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Regulation Of Payday Loans: Misguided?, Paige Marta Skiba
Regulation Of Payday Loans: Misguided?, Paige Marta Skiba
Vanderbilt Law School Faculty Publications
Since payday lenders came on the scene in 1990s, regulation of their "predatory" practices has been swift and often severe. Fourteen states now ban payday loans outright. From an economist's perspective, high-interest, short-term, small loans need not be a bad thing. Payday credit can help borrowers "smooth" consumption, unequivocally improving welfare as consumers borrow from future good times to help cover current shortfalls. These benefits of credit can accrue even at typical payday loan interest rates of 300%-600% APR. The question of whether payday credit actually assists borrowers in this way is an empirical one. In this Article, I review …
An Investigation Of The Rationality Of Consumer Valuations Of Multiple Health Risks, W. Kip Viscusi, Wesley A. Magat, Joel Huber
An Investigation Of The Rationality Of Consumer Valuations Of Multiple Health Risks, W. Kip Viscusi, Wesley A. Magat, Joel Huber
Vanderbilt Law School Faculty Publications
After developing a conceptual analysis of consumer valuation of multiple risks, we explore both economic and cognitive hypotheses regarding individual risk-taking. Using a sample of over 1,500 consumers, our study ascertains risk-dollar tradeoffs for the risks associated with using an insecticide and a toilet bowl cleaner. We observe the expected positive valuation of risk reductions andfind empirical supportfor a diminishing in the valuation of risk reduction as the extent of the risk reduction increases. We also find evidence of certainty premiums for the total elimination of one risk, but no strong evidence of additional certainty premiums for the elimination of …
Does Product Liability Make Us Safer?, W. Kip Viscusi
Does Product Liability Make Us Safer?, W. Kip Viscusi
Vanderbilt Law School Faculty Publications
Product liability law is intended to create an environment that fosters safer products. However, this law often has adverse consequences. Some of the problems stem from the inherent nature of product risk decisions and the function of tort liability, while others may derive from individuals’ cognitive limitations and inability to think properly about balancing risk and cost. This paper examines both types of problems and summarizes relevant academic literature.