One of the principal results in the economic theory of litigation is that the English rule of fee allocation (in which the loser pays the winner's litigation costs) is better at discouraging suits by low-probability-of-prevailing plaintiffs than the American rule (in which each side bears its own costs). This result has been demonstrated under the assumption that all suits that are filed go to trial. Using a standard asymmetric- information model of litigation, we show that when the settlement process is taken into account the English rule results in more low-probability-of-prevailing plaintiffs going to trial than the American rule. In this sense, the English rule encourages low-probability plaintiffs more than the American rule. Copyright 1998 by the University of Chicago.
Download Info
To our knowledge, this item is not available for
download. To find whether it is available, there are three
options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page
whether it is in fact available.
3. Perform a search for a similarly titled item that would be
available.
Contact details of provider: Postal: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637 Fax: (773) 753-0811 Email: Web page: http://www.journals.uchicago.edu/JLS/
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)