Accounting for the effects of disablement on future employment in Britain

Abstract

It is a common feature of both the English and the US legal systems that any person injured through the fault of another can claim monetary compensation, in the form of damages, for the injuries sustained.¹ The objective and measure of such damages is also the same across the jurisdictions, namely to restore the individual, in financial terms and in as far as it is possible to do so, to their pre-injury position. However, the approaches adopted in the two countries towards determining the level of damages are very different. In the United States, courts make extensive use of economists (called forensic economists), economic data and econometric methods to quantify damages, particularly in the calculation of those which relate to future losses. The courts in Britain do not, favouring instead the routine application of a simplified formula which is populated by figures chosen by judges, albeit with increasing reference to published actuarial averages. There has been a long-standing antipathy on the part of the judiciary towards evidence from financial experts. This has been justified on the grounds that predicting the future is nothing more than crystal ball gazing for which a judge is as well suited as any other profession.²

Citation

Wass, V. and McNabb, R. (2009), "Accounting for the effects of disablement on future employment in Britain", Ward, J.O. and Thornton, R.J. (Ed.) Personal Injury and Wrongful Death Damages Calculations: Transatlantic Dialogue (Contemporary Studies in Economic and Financial Analysis, Vol. 91), Emerald Group Publishing Limited, Leeds, pp. 73-101. https://doi.org/10.1108/S1569-3759(2009)0000091007