An experiment with two-way offers into court: restoring the balance in pre-trial negotiation
AbstractA common procedural device aimed at increasing the probability that pre-trial negotiations will lead to out of court settlement is defendant offers into court. Both in the UK following the Woolf Report (1996) and the Cullen Report (1995) and in the USA, the idea of extending the arrangements to plaintiff offers into court has been suggested. This paper presents an extension of the theoretical work by Chung (1996) on defendant offers into court under the American rule to cover the English rule and two-way offers into court. It also reports on experiments conducted to measure the effect of moving to two-way offers into court. The results suggest no impact on the propensity to settle and a statistically significant but empirically modest movement of settlement in favour of the plaintiff.
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Bibliographic InfoPaper provided by Edinburgh School of Economics, University of Edinburgh in its series ESE Discussion Papers with number 28.
Date of creation: Apr 2004
Date of revision:
Find related papers by JEL classification:
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-04-25 (All new papers)
- NEP-EXP-2004-04-25 (Experimental Economics)
- NEP-LAW-2004-04-25 (Law & Economics)
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- Chung, Tai-Yeong, 1996. "Settlement of Litigation under Rule 68: An Economic Analysis," The Journal of Legal Studies, University of Chicago Press, vol. 25(1), pages 261-86, January.
- Anderson, David A, 1994. "Improving Settlement Devices: Rule 68 and Beyond," The Journal of Legal Studies, University of Chicago Press, vol. 23(1), pages 225-46, January.
- Tversky, Amos & Kahneman, Daniel, 1986. "Rational Choice and the Framing of Decisions," The Journal of Business, University of Chicago Press, vol. 59(4), pages S251-78, October.
- Landes, William M, 1971. "An Economic Analysis of the Courts," Journal of Law and Economics, University of Chicago Press, vol. 14(1), pages 61-107, April.
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