Two by Avraham on Pain and Suffering

Ronen Avraham (Texas) has posted two pieces to SSRN.  First, Does the Theory of Insurance Support Awarding Pain and Suffering Damages in Tort?.  The abstract provides:

This chapter asks whether THE THEORY OF INSURANCE SUPPORTS AWARDING PAIN AND SUFFERING DAMAGES IN TORTS. The answer is an unequivocal “Yes.” Many commentators have argued that individuals do not (and should not) demand insurance for losses that do not lower their marginal utility of wealth. From this perspective, tort laws that provide victims with compensation for pain and suffering harms effectively force them to purchase insurance that they don’t value. This chapter disputes this logic on several levels. First, it suggests that so-called “pure non-monetary losses” are exceedingly rare in practice, and are difficult to define even in theory. Moreover, non-monetary losses are likely to be correlated with monetary losses, and this correlation generates a demand for insurance covering both types of losses under the traditional model used by law and economics scholars. Coverage of non-monetary losses can also be demanded under many plausible alternatives to expected utility theory. The chapter also takes issue with the empirical evidence that some have interpreted as suggesting a lack of demand for coverage of non-monetary losses. Finally, the chapter suggest that future advances in neuroscience may make it possible to accurately measure mental states associated with pain and suffering, obviating the need for the subjective testimony that introduces so much noise into the assessment of these damages.

Second, Estimating Pain and Suffering Damages-Paths are Many, Loss is One.  The abstract provides:

Opponents of pain and suffering damages argue that, unlike pecuniary damages, pain and suffering damages are hard to quantify accurately. They argue that victims exaggerate their losses to receive higher damage awards, so that awarding pain and suffering damages may frustrate the function of tort law by compensating the victims too highly and arbitrarily. Another argument against pain and suffering damages is that the difficulty in objective measurement leaves the potential for enormous variance in awards at the discretion of individual judges and juries. This individual discretion may create a lack of horizontal equity and thus impede consistency among awards for like victims.

In a recent paper I argued that from a law and economics perspective pain and suffering damages should be fully compensated and should receive the same “respect” that economic damages receive (Avraham, 2015). I provided several arguments for that view. In this chapter I survey a number of solutions discussed in the literature on how to simplify the estimation of pain and suffering damages to cut administrative costs. My goal is to demonstrate the feasibility of the task of estimating the loss more than to recommend any specific path to it.