Lost Earnings v. Lost Earning Capacity

Lost Earnings v. Lost Earning Capacity

One of many issues that can arise in calculating economic damages in personal injury litigation is the important distinction between projecting a person’s future earnings and a person’s future earning capacity. Earnings are defined as remuneration of a worker for services performed during a specific period of time. When projecting future earnings the economist is projecting the amount the person would have earned but for an injury. When projecting future earning capacity the economist is projecting the amount the person could have earned if he had chosen to maximize his earnings.

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