Research & Publications

Damages: Estimating Pecuniary Loss (Chapter 1)

by Cara L. Brown

Chapter 1 – Establishing Earning Capacity in Personal Injury and Wrongful Death Cases

Chapter 1 of Damages: Estimating Pecuniary Loss focuses on an individual’s work and income history to determine his or her base year salary at the date of work interruption. Additionally, since economists use various data sources to project base year earnings, this chapter evaluates the utility of these diverse sources including census data, the Survey of Consumer Finance, the Survey of Labour Income and Dynamics, private sector salary surveys, and trade or professional association surveys. For cases involving injured/deceased minors or young adult plaintiffs who have not established careers for which base year earnings can be determined, Chapter 1 addresses related issues such as the education level among Canada’s youth, intergenerational transmission of social mobility, and whether one’s job is typically related to one’s education. Finally, speaking to a very current issue regarding the projection of salaries for female plaintiff using male wage statistics, the chapter provides various estimates of the size of the gender wage gap, hypothesized causes of that gap, and the implications of this data for assessing damages.