- search hit 1 of 1
Auditor liability rules under imperfect information and costly litigation : the welfare increasing effect of liability insurance
- This paper examines auditor liability rules under imperfect information, costly litigation and risk averse auditors. A negligence rule fails in such a setting, because in equilibrium auditors will deviate with positive probability from any given standard. It is shown that strict liability outperforms negligence with respect to risk allocation, and the probability that a desired level of care is met by the audi tor if competitive liability insurance markets exist. Furthermore, our model explains the existence of insurance contracts containing obligations - a type of contract often observed in liability insurance markets.
Author: | Ralf Ewert, Eberhard Feess, Martin Nell |
---|---|
URN: | urn:nbn:de:hebis:30:3-553566 |
Parent Title (German): | Universität Frankfurt am Main. Fachbereich Wirtschaftswissenschaften: [Working paper series / Finance and accounting] Working paper series, Finance & Accounting ; No. 28 |
Series (Serial Number): | Working paper series / Johann-Wolfgang-Goethe-Universität Frankfurt am Main, Fachbereich Wirtschaftswissenschaften : Finance & Accounting (28) |
Publisher: | Johann Wolfgang Goethe-Universität, Fachbereich Wirtschaftswissenschaften |
Place of publication: | Frankfurt am Main |
Document Type: | Working Paper |
Language: | English |
Date of Publication (online): | 2022/05/02 |
Year of first Publication: | 1999 |
Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
Release Date: | 2022/05/02 |
Tag: | auditor liability; liability insurance; risk allocation |
Page Number: | 21 |
Last Page: | 15 |
HeBIS-PPN: | 495043095 |
Institutes: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
Sammlungen: | Universitätspublikationen |
Licence (German): | Deutsches Urheberrecht |