Discuss how the legal doctrine of strict liability will lead to a more efficient use of society’s resources
Please provide the best answer for the statement.
Answer: The social cost view based on the legal doctrine of strict liability is founded on utilitarian arguments. This says the external costs of injuries are part of the costs society must pay for producing the items. Internalizing all costs will lead to a more efficient use of resources because the price will reflect all the costs of producing and using the items, and market forces will ensure the product is not overproduced and resources are not wasted on it. Second, because manufacturers have to pay the costs of injuries, they will exercise greater care and thereby reduce the number of accidents. Manufacturers will work to cut the social costs of injuries, which means a more efficient use of resources. Third, by internalizing the costs of injury this way, the manufacturers can distribute losses among all users of the product instead of allowing losses to fall on a few injured individuals who would otherwise have to bear the costs of injury.
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