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Lawyers as Agents of the Devil in a Prisoner's Dilemma Game

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  • Orley Ashenfelter
  • David Bloom

Abstract

The goal of this paper is to explore the possibility that the costs and benefits of legal representation are structured so that each individual 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 first part of the paper shows how the structure of the incentives faced by the parties may be estimated, and the second describes the results of empirical tests in several different settings. The empirical results strongly suggest that the parties do face "prisoner's dilemma" incentives, although no attempt is made to determine whether the parties respond to these interviews.

Suggested Citation

  • 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.
  • Handle: RePEc:nbr:nberwo:4447
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    References listed on IDEAS

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    1. Richard N. Block & Jack Stieber, 1987. "The Impact of Attorneys and Arbitrators on Arbitration Awards," ILR Review, Cornell University, ILR School, vol. 40(4), pages 543-555, July.
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    3. 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 819-844, July.
    4. William M. Landes & Richard A. Posner, 1978. "Adjudication as a Private Good," NBER Working Papers 0263, National Bureau of Economic Research, Inc.
    5. 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.
    6. Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1991. "The Allocation of Talent: Implications for Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 503-530.
    7. Bloom, David E, 1986. "Empirical Models of Arbitrator Behavior under Conventional Arbitration," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 578-585, November.
    8. repec:fth:prinin:219 is not listed on IDEAS
    9. Henry S. Farber, 1980. "An Analysis of Final-Offer Arbitration," Journal of Conflict Resolution, Peace Science Society (International), vol. 24(4), pages 683-705, December.
    10. 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.
    11. Orley Ashenfelter, 1987. "Arbitrator Behavior," Working Papers 599, Princeton University, Department of Economics, Industrial Relations Section..
    12. Ashenfelter, Orley, 1987. "Arbitrator Behavior," American Economic Review, American Economic Association, vol. 77(2), pages 342-346, May.
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    14. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-1426, November.
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    16. Orley Ashenfelter & David Bloom, 1981. "Models of Arbitrator Behavior: Theory and Evidence," Working Papers 526, Princeton University, Department of Economics, Industrial Relations Section..
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    Citations

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    Cited by:

    1. Bruce D. Meyer, 1992. "Policy Lessons from the U.S. Unemployment Experiments," NBER Working Papers 4197, National Bureau of Economic Research, Inc.
    2. 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.
    3. Jack Hirshleifer & Evan Osborne, 1996. "The Legal Battle," UCLA Economics Working Papers 749, UCLA Department of Economics.
    4. Juranek, Steffen, 2015. "Investing in legal advice - What determines the costs of enforcing intellectual property rights?," Discussion Papers 2015/20, Norwegian School of Economics, Department of Business and Management Science.
    5. Jean Olson Lanjouw, 1993. "Patent Protection: Of What Value and for How Long?," NBER Working Papers 4475, National Bureau of Economic Research, Inc.
    6. Dr Ronald W. McQuaid, 1994. "Partnerships And Urban Economic Development," Working Paper p13, Departement of Economics, Napier University.
    7. Robert M. Hutchens, "undated". "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.
    8. Halla, Martin, 2007. "Divorce and the Excess Burden of Lawyers," IZA Discussion Papers 2962, Institute for the Study of Labor (IZA).
    9. Jack Hirshleifer & Evan Osborne, 1999. "Truth and the Legal Battle," UCLA Economics Working Papers 790, UCLA Department of Economics.

    More about this item

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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