The economist applies earnings base, growth rates, work-life expectancy, and discount rates to project and reduce future losses to present value. Assumptions rather than arithmetic drive the result.
Each assumption is independently contestable.
Alternative Names:
Forensic Economist Testimony|Economic Expert Testimony
Why it Matters?
Assumptions rather than calculations are where these opinions are challenged, since the arithmetic is rarely wrong while the earnings base, growth rate, work-life expectancy, and discount rate each independently move the total substantially. Requiring the economist to produce alternative calculations under different assumptions demonstrates the sensitivity. Fringe benefit and tax treatment are additional variables frequently handled inconsistently.
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Frequently asked questions
Where are economist opinions challenged?
What demonstrates sensitivity?
