The Economics of Legal Conflicts

Gould, John

doi:10.1086/467499

“…Based on the divergent expectations theories of litigation, a reduction in the extent of divergence of parties' expectations about the expected trial outcome facilitates settlement (see, e.g., Landes 1971, Gould 1973, Posner 1977, Shavell 1982, Priest and Klein 1984, Farber and White 1991, Doornik 2014. We, therefore, hypothesize (Hypothesis 1a) that completion of the first court session and exposure to court-annexed mediation reduce the time to settlement.…”

Section: Explanatory Variables and Hypothesesmentioning

confidence: 96%

“…Early contributions to this literature, due to Landes (1971), Gould (1973), Posner (1977), andShavell (1982), as well as subsequent model by Priest and Klein (1984), attribute divergent expectations to exogenously determined excessive optimism by one or both disputing parties. Using a nonstrategic approach, these contributions examine the parties' incentives to settle rather than pursue trial by concentrating on the existence of a range of mutually acceptable settlement offers.…”

Section: Theorymentioning

confidence: 99%

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Litigation and the timing of settlement: evidence from commercial disputes

Grajzl

¹

,

Zajc

²

2016

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Although an overwhelming proportion of all legal disputes end in settlement, the determinants of the timing of settlement remain empirically underexplored. We draw on a novel dataset on the duration of commercial disputes in Slovenia to study how the timing of settlement is shaped by the stages and features of the litigation process. Using competing risk regression analysis, we find that events such as court-annexed mediation and the first court session, which enable the disputing parties to refine their respective expectations about the case outcome, in general reduce case duration to settlement. The magnitude of the respective effects, however, varies with time. Completion of subsequent court sessions, in contrast, does not affect the time to settlement. Judicial workload affects the timing of settlement indirectly, via the effect on the timing of the first court session. We also examine the effect of other case and party characteristics. Terms of use: Documents inJEL-Code: K410, K490, D020.

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“…Although we had to exclude the judgespecific control variables in this case, the results for the remaining independent variables remained qualitatively unchanged. 21 We also estimated a reduced model using only the significant predictors in the regression equation without effect on the qualitative results. 18 As we only have cross-section data, we can hardly solve this endogeneity problem.…”

Section: Determinants Of Settlement Probabilitymentioning

confidence: 99%

“…20 The German Civil Process Order allows judges greater discretion in the proceedings ( §495a ZPO) and to write shorter verdicts (313a ZPO) for verdicts which cannot be appealed. 21 The referring estimation results are shown in the Annex, see Table A4. 17 …”

Section: Determinants Of Settlement Probabilitymentioning

confidence: 99%

Determinants of in-court settlements: empirical evidence from a German trial court

Berlemann

¹

,

Christmann

²

2018

Journal of Institutional Economics

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may Zusammenfassung / AbstractBecause verdicts are typically the more costly resolution of legal disputes, most governments are interested in high settlement rates. In this paper, we use a unique dataset of 860 case records from a German trial court to explore which factors have a significant impact on the decision to settle in civil law litigation. We find that case-specific factors, procedural aspects and individual characteristics of the involved judge have a significant impact on settlement probability. Interestingly, we find supporting evidence for the hypothesis that the gender of the involved judge has an impact on settlement probabilities in certain subfields of law. Based on our empirical results, we derive some conclusions for legal policies that aim at increasing settlement rates. To be able to construct legal systems that facilitate early settlements of legal disputes, it is necessary to identify the factors that have a significant impact on settlement probability. 1 However, little empirical knowledge is available on this issue as yet. A major reason for the scarcity of empirical evidence on the determinants of settlement probability is that suitable data to study this issue are often unavailable. Databases on verdicts are often available; however, according to the well-established Case Selection Hypothesis put forward by PRIEST and KLEIN (1984), verdicts (and thus settlements) are not a random draw from the pool of all legal disputes. Empirical evidence that is solely based on verdict databases is thus likely biased. To gain unbiased evidence on the determinants of settlement probability, a random sample of legal disputes that contains both court decisions and settlements is necessary. However, these types of data are mostly unavailable as yet.In this paper, we contribute to filling the described gap in the literature. Using a novel, hand-collected dataset consisting of 860 case records from a German trial court, we employ the logit regression technique to identify factors that influence the probability of 1 Note that we do not argue that promoting settlements is in fact always s ocially efficient. For critical assessments of settlements and judicial discretion to achieve them, see, e.g., RESNIK (2002) The remainder of the paper is structured as follows: Section 2 reviews the related literature. Section 3 introduces and summarizes the dataset. In section 4, we report the empirical results of our analysis ...

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The bioeconomic causes of war

Hirshleifer

¹

1998

Manage. Decis. Econ.

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Wars are fought not only for material goals but for intangible ends such as honor and prestige. In biological terms the ultimate functional motives for fighting are food and sex, the essential elements of reproductive success. Like many other animals, humans seek food and sex directly, but also indirectly via dominance and prestige. In modern times the direct food and sex motives for warfare have waned. But, although largely disconnected from reproductive success, intangible goals such as prestige, dominance, and respect—amplified by the ‘affiliative instinct’—remain with us as continuing causes of war. © 1998 John Wiley & Sons, Ltd.

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The Economics of Legal Conflicts

Cited by 332 publications

References 0 publications

Litigation and the timing of settlement: evidence from commercial disputes

Litigation and the timing of settlement: evidence from commercial disputes

Determinants of in-court settlements: empirical evidence from a German trial court

The bioeconomic causes of war

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