Economics of Wrongful Death Damages

Economic Damages• Lost support for survivors

– Market support– Non-market support

• Limited to dependent survivors

• Does not include non-pecuniary damages such as emotional damages

Market Support• Lost earnings or earnings

capacity?• Lost earnings less own

consumption

Factor Influencing Earnings• Age• Education• Location• Gender• Race?

Taxes• Federal law deducts taxes

from market earnings• Ohio does not deduct

taxes• Other jurisdictions vary

Present Value Analysis• Some states provide a

statutory discount rate– Ohio does not

• Real or nominal analysis?– Consistency

Jones & Laughlin Steel Corp. V. Pfeifer, 462 U.S. 523 (1983) • The discount rate should be

based on the rate of interest that would be earned on "the best and safest investments." Once it is assumed that the injured worker would definitely have worked for a specific term of years, he is entitled to a risk-free stream of future income to replace his lost wages; therefore, the discount rate should not reflect the market's premium for investors who are willing to accept some risk of default.

Worklife• Only includes years of active

labor force participation– Active versus Inactive– Unemployment– Age– Gender

• Less than years to final separation

• Calculations typically push years up front

Own Consumption of Deceased• Not deducted in all states

– Own consumption expenditures deducted in Ohio

• Only deduct expenditures that were for the exclusive support of the deceased

• Joint expenditures that benefit other family members should not be deducted

Duration of Market Support• Life expectancy of spouse

– Typically exceeds worklife– Remarriage?

• Market support for children– Age of majority?– Support for adult children

• Parental support?

Non-market Support• Household production

– Home maintenance– Laundry– Cooking– Production of products that

are jointly consumed• Care of children

Factors Influencing Non-market Support• Gender• Employment• Children• Age• Health (Healthy Life

Expectancy)

WD Damages in Same-sex Marriages• Do we apply traditional

gender roles?• Do we utilize gender

specific data?

Hedonic Damages• Hedonic Damages

– The lost enjoyment of life– More likely to be permitted

in a survival action• Expert witness testimony

– Varies among jurisdictions– Ohio

• Not an element of damages in wrongful death

• May be admitted in Ohio at the discretion of the trial court in a personal injury case