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Evidentiary Arbitrage: The Fabrication of Evidence and The Verifiability of Contract Performance


  • Chris Sanchirico

    (University of Pennsylvania)

  • George Triantis

    (University of Virginia School of Law)


Evidentiary Arbitrage: The Fabrication of Evidence and The Verifiability of Contract Performance - Contract theory identifies verifiability as a critical determinant of the incompleteness of contracts. Although verifiability refers to the cost of proving relevant facts to a court, very little scholarship connects explicitly the evidentiary process to the drafting of substantive contract terms. This paper begins to explore this relationship to provide a more rigorous explanation of contract design. In particular, the paper concerns the very core of verifiability ? truth-finding by a court ? and examines the impact of the prospect of evidence fabrication on contracting. It thereby also explores the puzzling tolerance of the adjudicatory system for fabrication and the incentives to fabricate created by thresholds in burdens of proof. The paper suggests that, despite undermining truth-finding, evidence fabrication may be harnessed by contracting parties to improve the (evidentiary) cost-efficiency of performance incentives in their relationship.

Suggested Citation

  • Chris Sanchirico & George Triantis, "undated". "Evidentiary Arbitrage: The Fabrication of Evidence and The Verifiability of Contract Performance," University of Virginia John M. Olin Program for Law & Economics Working Paper Series uvalwps-1011, University of Virginia School of Law.
  • Handle: RePEc:bep:uvalwp:uvalwps-1011

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    References listed on IDEAS

    1. Joseph E. Aldy & W. Kip Viscusi, 2004. "Age Variations in Workers' Value of Statistical Life," NBER Working Papers 10199, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Ian A. MacKenzie, 2014. "Precaution with endogenous litigation choices," Discussion Papers Series 535, School of Economics, University of Queensland, Australia.
    2. Liu, Zhiyong & Avraham, Ronen, 2012. "Ex ante versus ex post expectation damages," International Review of Law and Economics, Elsevier, vol. 32(4), pages 339-355.
    3. Jesse Bull, 2013. "Interrogation and Evidence Fabrication," Working Papers 1303, Florida International University, Department of Economics.

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