Statistical evidence and incentives in the law

Is it bad practice to use statistical evidence as the basis for a finding of guilt or liability? And if it is bad practice, why is it bad practice? This paper focuses on the incentivizing aspects of candidate legal systems in civil cases. Incentives clearly matter––a legal system which encouraged bad behavior could easily be problematic even if it reliably penalized those who ran afoul of the law and did not penalize those who did not. And the use of statistical evidence does have implications for incentives.

Section One introduces some important preliminary distinctions. Section Two works through the incentive structure of some simple hypothetical cases. Section Three examines the incentive structures that emerge in the case that has been most discussed in the literature on statistical evidence – the Blue Bus Case. Section Four looks at a class of cases that contrast in some interesting ways with the Blue Bus scenario, namely toxic torts. As we explain, those cases provide a much better incentive-based case for findings of liability based on statistical evidence.

We are by no means the first authors to explore the connections between statistical evidence and incentives. In two much cited papers, Enoch, Fisher, and Spectre (2012) and Enoch and Fisher (2015) consider this issue, contending that it is bad practice to use statistical evidence because the use of statistical evidence incentivizes (or at least fails to disincentivize) bad behavior. We think there is a good deal to be learned by careful engagement with these two papers, but as we explain, their discussion of incentives goes wrong in some important ways.

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