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Christine Piette Durrance, Noneconomic Damage Caps and Medical Malpractice Claim Frequency: A Policy Endogeneity Approach, The Journal of Law, Economics, and Organization, Volume 26, Issue 3, December 2010, Pages 569–591, https://doi.org/10.1093/jleo/ewp022
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Abstract
Medical malpractice has received much attention in the media with highly publicized jury awards and reported consequences of excessive litigation. Health care and medical malpractice remain a prominent issue, especially in the current political climate. Policy endogeneity, however, plagues most analyses of various federal, state, or local policies. In this article, I analyze the effect of noneconomic damage caps on the frequency of positive payment medical malpractice claims, recognizing that these laws are likely endogenous. I construct a unique instrument using past and current values of state political composition and other factors. In contrast to previous literature, I find no evidence that caps on noneconomic damages are associated with a reduction in medical malpractice positive payment claim frequency.