Lawyers as Agents of the Devil in a Prisoner's Dilemma Game
AbstractDo the parties in a typical dispute face incentives similar to those in the classic prisoner’s dilemma game? In this paper, we explore whether the costs and benefits of legal representation are such that each party seeks legal representation in the hope of exploiting the other party, while knowing full well that failing to do so will open up the possibility of being exploited. The paper first shows how it is possible to test for the presence of such an incentive structure in a typical dispute resolution system. It then reports estimates of the incentives for the parties to obtain legal representation in wage disputes that were settled by final-offer arbitration in New Jersey. The paper also reports briefly on similar studies of data from discharge grievances, courtannexed disputes in Pittsburgh, and child custody disputes in California. In each case, the data provide evidence that the parties face strong individual incentives to obtain legal representation which makes the parties jointly worse off. Using our New Jersey data, we find that expert agents may well have played a productive role in moderating the biases of their clients, but only early on in the history of the system. Over time, the parties slowly evolved to a non-cooperative equilibrium where the use of lawyers becomes nearly universal, despite the fact that agreeing not to hire lawyers is cheaper and does not appear to alter arbitration outcomes.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Princeton University, Department of Economics, Industrial Relations Section. in its series Working Papers with number 1451.
Date of creation: Apr 2013
Date of revision:
Contact details of provider:
Postal: Firestone Library, Princeton, New Jersey 08544-2098
Phone: 609 258-4041
Fax: 609 258-2907
Web page: http://www.irs.princeton.edu/
More information through EDIRC
Prisoners dilemma; new jersey; criminal courts; lawyers; Pittsburgh; child custody; California;
Other versions of this item:
- Ashenfelter, O. & Bloom, D., 1990. "Lawyers As Agents Of The Devil In A Prisoner'S Dilemma Game," Papers 57, Princeton, Woodrow Wilson School - Discussion Paper.
- Orley Ashenfelter & David Bloom, 1993. "Lawyers as Agents of the Devil in a Prisoner's Dilemma Game," NBER Working Papers 4447, National Bureau of Economic Research, Inc.
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- D02 - Microeconomics - - General - - - Institutions: Design, Formation, and Operations
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
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.:
- repec:pri:indrel:563 is not listed on IDEAS
- Orley Ashenfelter, 1987. "Arbitrator Behavior," Working Papers 599, Princeton University, Department of Economics, Industrial Relations Section..
- repec:pri:indrel:599 is not listed on IDEAS
- Farber, Henry S & Bazerman, Max H, 1986. "The General Basis of Arbitrator Behavior: An Empirical Analysis of Conventional and Final-Offer Arbitration," Econometrica, Econometric Society, vol. 54(6), pages 1503-28, November.
- Ashenfelter, Orley C, 1978. "Estimating the Effect of Training Programs on Earnings," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 47-57, February.
- Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1990.
"The Allocation of Talent: Implicationsfor Growth,"
University of Chicago - George G. Stigler Center for Study of Economy and State
65, Chicago - Center for Study of Economy and State.
- Ashenfelter, Orley, 1987. "Arbitrator Behavior," American Economic Review, American Economic Association, vol. 77(2), pages 342-46, May.
- Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-26, November.
- Bloom, David E, 1986.
"Empirical Models of Arbitrator Behavior under Conventional Arbitration,"
The Review of Economics and Statistics,
MIT Press, vol. 68(4), pages 578-85, November.
- David E. Bloom, 1986. "Empirical Models of Arbitrator Behavior Under Conventional Arbitration," NBER Working Papers 1841, National Bureau of Economic Research, Inc.
- William M. Landes & Richard A. Posner, 1978. "Adjudication as a Private Good," NBER Working Papers 0263, National Bureau of Economic Research, Inc.
- repec:fth:prinin:219 is not listed on IDEAS
- Charles F. Adams Jr. & Robert F. Cook & Arthur J. Maurice, 1983. "A Pooled Time-Series Analysis of the Job-Creation Impact of Public Service Employment Grants to Large Cities," Journal of Human Resources, University of Wisconsin Press, vol. 18(2), pages 283-294.
- Orley Ashenfelter & David E. Bloom, 1983. "Models of Arbitrator Behavior: Theory and Evidence," NBER Working Papers 1149, National Bureau of Economic Research, Inc.
- Kiefer, Nicholas M., 1978. "Federally subsidized occupational training and the employment and earnings of male trainees," Journal of Econometrics, Elsevier, vol. 8(1), pages 111-125, August.
- Farber, Henry S & Bazerman, Max H, 1986. "The General Basis of Arbitrator Behavior: An Empirical Analysis of Conventional and Final-Offer Arbitration," Econometrica, Econometric Society, vol. 54(4), pages 819-44, July.
- Richard N. Block & Jack Stieber, 1987. "The impact of attorneys and arbitrators on arbitration awards," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 40(4), pages 543-555, July.
- LaLonde, Robert J, 1986. "Evaluating the Econometric Evaluations of Training Programs with Experimental Data," American Economic Review, American Economic Association, vol. 76(4), pages 604-20, September.
- repec:fth:prinin:183 is not listed on IDEAS
- Martin Halla, 2007.
"Divorce and the Excess Burden of Lawyers,"
Economics working papers
2007-13, Department of Economics, Johannes Kepler University Linz, Austria.
- Iossa, Elisabetta & Jullien, Bruno, 2007. "The Market for Lawyers: The Value of Information on the Quality of Legal Services," IDEI Working Papers 485, Institut d'Économie Industrielle (IDEI), Toulouse.
- Jack Hirshleifer & Evan Osborne, 1996. "The Legal Battle," UCLA Economics Working Papers 749, UCLA Department of Economics.
- Jean Olson Lanjouw, 1993. "Patent Protection: Of What Value and for How Long?," NBER Working Papers 4475, National Bureau of Economic Research, Inc.
- Henry S. Farber & Michael J. White, 1993. "A Comparison of Formal and Informal Dispute Resolution in Medical Malpractice," NBER Working Papers 4371, National Bureau of Economic Research, Inc.
- Dr Ronald W. McQuaid, 1994. "Partnerships And Urban Economic Development," Working Paper p13, Departement of Economics, Napier University.
- Jack Hirshleifer & Evan Osborne, 1999. "Truth and the Legal Battle," UCLA Economics Working Papers 790, UCLA Department of Economics.
- repec:pri:indrel:693 is not listed on IDEAS
- Bruce D. Meyer, 1992. "Policy Lessons from the U.S. Unemployment Experiments," NBER Working Papers 4197, National Bureau of Economic Research, Inc.
- Robert M. Hutchens, . "A Path to Good Jobs? Unemployment and Low Wages: The Distribution of Opportunity for Young Unskilled Workers," Economics Public Policy Brief Archive 11, Levy Economics Institute, The.
- repec:fth:prinin:314 is not listed on IDEAS
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Long).
If references are entirely missing, you can add them using this form.