| Abstract: | This article looks at the effect that damage caps have on plaintiffs'recovery in medical malpractice litigation, using a unique dataset of litigation in the South, from 1987 to 1999. During thistime, Alabama underwent both the implementation and nullificationof damage-cap laws; neighboring states did not undergo any significantlegal changes. The product of a difference-in-difference approach,the results reveal that the average relative recovery by Alabamaplaintiffs decreased by roughly $20,000 after the Alabama legislatureenacted damage caps and increased by roughly double that amountafter the Alabama Supreme Court ruled them unconstitutional. |
