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Are bar associations anticompetitive? An empirical analysis of recommended prices for legal services in Spain

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  • Aitor Ciarreta
  • María Espinosa
  • Aitor Zurimendi

Abstract

The European Commission Report on Competition in Professional Services found that recommended prices by professional bodies have a significant negative effect on competition since they may facilitate the coordination of prices between service providers and/or mislead consumers about reasonable price levels. Professional associations argue, first, that a fee schedule may help their members to properly calculate the cost of services avoiding excessive charges and reducing consumers’ searching costs and, second, that recommended prices are very useful for cost appraisal if a litigant is condemned to pay the legal expenses of the opposing party. Thus, recommended fee schedules could be justified to some extent if they represented the cost of providing the services. We test this hypothesis using cross-section data on a subset of recommended prices by 83 Spanish bar associations and cost data on their territorial jurisdictions. Our empirical results indicate that prices recommended by bar associations are unrelated to the cost of legal services. Therefore, we conclude that fee schedules are not playing the role of providing useful cost information to practitioners and therefore this efficiency justification is weak. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Aitor Ciarreta & María Espinosa & Aitor Zurimendi, 2014. "Are bar associations anticompetitive? An empirical analysis of recommended prices for legal services in Spain," European Journal of Law and Economics, Springer, vol. 38(3), pages 471-484, December.
    • Handle: RePEc:kap:ejlwec:v:38:y:2014:i:3:p:471-484
    DOI: 10.1007/s10657-012-9367-7
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    References listed on IDEAS

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    1. Michele Grillo, 2002. "Collusion and Facilitating Practices: A New Perspective in Antitrust Analysis," European Journal of Law and Economics, Springer, vol. 14(2), pages 151-169, September.
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    Cited by:

    1. González-Maestre, Miguel & Peñarrubia, Diego, 2020. "Anticompetitive traps and voting," Mathematical Social Sciences, Elsevier, vol. 104(C), pages 47-59.

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    More about this item

    Keywords

    Professional associations; Recommended prices; Anticompetitive conduct; K21; L44;
    All these keywords.

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law

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