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Asking for information prior to settlement or trial when misrepresentation of evidence is possible

Author

Listed:
  • Mehdi Ayouni

    (BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Tim Friehe

    (University of Marburg, CESifo - CESifo, EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

  • Yannick Gabuthy

    (BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

This paper analyzes how mandated information disclosure prior to settlement negotiations influences equilibrium outcomes when the privately informed party may misrepresent its type at a cost. We establish that private information cannot be fully revealed and that a regime without information sharing may outperform a regime with information sharing according to the criteria of expected social costs and fairness considerations.

Suggested Citation

  • Mehdi Ayouni & Tim Friehe & Yannick Gabuthy, 2023. "Asking for information prior to settlement or trial when misrepresentation of evidence is possible," Post-Print hal-03987359, HAL.
    • Handle: RePEc:hal:journl:hal-03987359
    DOI: 10.1016/j.mathsocsci.2022.12.001
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    Cited by:

    1. Ayouni, Mehdi & Friehe, Tim & Gabuthy, Yannick, 2024. "Bayesian persuasion in lawyer–client communication," International Review of Law and Economics, Elsevier, vol. 78(C).

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