Costly Pretrial Agreements
Leonardo Felli () and
Giovanni Immordino ()
The Journal of Legal Studies, 2019, vol. 48, issue 1, 159 - 188
Settling a legal dispute involves some costs that the parties have to incur ex ante for the pretrial negotiation and possible agreement to become feasible. Even in a full-information world, if the distribution of these costs is sufficiently mismatched with the distribution of the parties’ bargaining powers, a pretrial agreement may never be reached even though litigation is overall wasteful. Our results shed light on two key issues. First, a plaintiff may initiate a lawsuit even though the parties fully anticipate that it will be settled out of court. Second, the likelihood that a given lawsuit goes to trial is unaffected by how trial costs are distributed among the litigants. The choice of fee-shifting rule can affect only whether the plaintiff files a lawsuit in the first place. It does not affect whether it is settled before trial or litigated.
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Access to the online full text or PDF requires a subscription.
Working Paper: Costly pretrial agreements (2019)
Working Paper: Costly Pretrial Agreements (2018)
Working Paper: Costly Pre-Trial Agreements (2018)
Working Paper: Costly Pretrial Agreements (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ucp:jlstud:doi:10.1086/699841
Access Statistics for this article
More articles in The Journal of Legal Studies from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().