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Of hired guns and ideologues: why would a law firm ever retain an honest expert witness?

Martin Richardson

ANU Working Papers in Economics and Econometrics from Australian National University, College of Business and Economics, School of Economics

Abstract: We suppose that expert witnesses are, generically, either honest in their assessment of a fact situation or are mercenary ‘hired guns’ that advocate for their retaining party. The type of a witness is known to law firms, who engage with them repeatedly, but not to courts. If the only way an honest witness can credibly reveal their type to a court is by siding with the opposing party then the question arises of why a law firm would ever retain an honest expert. We show that it can act as a signaling device in a game between the law firms to communicate private information regarding a party’s confidence in winning the case. Our results indicate, amongst other things, that the ‘English’ rule of costs allocation can make a socially desirable separating equilibrium less likely, compared to the ‘American’ rule.

Keywords: expert witnesses; signaling; litigation (search for similar items in EconPapers)
JEL-codes: C72 D82 K41 (search for similar items in EconPapers)
Date: 2021-08
New Economics Papers: this item is included in nep-gth, nep-isf, nep-law and nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:acb:cbeeco:2021-678

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