For the theoretical background, see Ronald Coase on Transaction Cost Economics. The law can place liability anywhere. In a situation where transaction costs a

For the theoretical background, see Ronald Coase on Transaction Cost Economics. The law can place liability anywhere. In a situation where transaction costs are zero, it doesn't actually matter where liability is placed, because the participants will contract in the most economically efficient manner to share the burden. That means liability choices can reduce to reducing transaction costs. For credit, the $50 is to avoid the adverse incentive of the cardholder permitting fraud, but otherwise the cost and mitigation is better shared among the big players at scale that reduces overhead. (Conversely, shifting liability via forced arbitration and legal disclaimers monetizes market power.) As a policy matter, ask yourself: so why then do debit cards not come with the same limitation of fraud liability to $50, since the same economies of scale apply?