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A Note on Trial Delay and Social Welfare: The Impact of Multiple Equilibria

Author

Listed:
  • Tim Friehe

    (University of Marburg)

  • Thomas J. Miceli

    (University of Connecticut)

Abstract

Greater trial delay is commonly associated with decreasing demand for trials, thereby bringing about an equilibrium for a given trial capacity. This note highlights that – in contrast to this premise – trial delay may in fact increase trial demand. Such an outcome is established for a scenario in which the number of cases is endogenous based on the deterrence effect of lawsuits. That trial demand may increase with longer delay makes multiple stable equilibria possible. This reality has important policy implications, which are discussed.

Suggested Citation

  • Tim Friehe & Thomas J. Miceli, 2015. "A Note on Trial Delay and Social Welfare: The Impact of Multiple Equilibria," Working papers 2015-08, University of Connecticut, Department of Economics.
  • Handle: RePEc:uct:uconnp:2015-08
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    References listed on IDEAS

    as
    1. Kessler, Daniel, 1996. "Institutional Causes of Delay in the Settlement of Legal Disputes," Journal of Law, Economics, and Organization, Oxford University Press, vol. 12(2), pages 432-460, October.
    2. Chappe, Nathalie & Obidzinski, Marie, 2014. "The impact of the number of courts on the demand for trials," International Review of Law and Economics, Elsevier, vol. 37(C), pages 121-125.
    3. Lucian Arye Bebchuk, 1984. "Litigation and Settlement under Imperfect Information," RAND Journal of Economics, The RAND Corporation, vol. 15(3), pages 404-415, Autumn.
    4. Di Vita, Giuseppe, 2010. "Production of laws and delays in court decisions," International Review of Law and Economics, Elsevier, vol. 30(3), pages 276-281, September.
    5. Gravelle, H. S. E., 1990. "Rationing trials by waiting: Welfare implications," International Review of Law and Economics, Elsevier, vol. 10(3), pages 255-270, December.
    6. Miceli, Thomas J., 1999. "Settlement delay as a sorting device," International Review of Law and Economics, Elsevier, vol. 19(2), pages 265-274, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    trial; delay; care; multiple equilibria;

    JEL classification:

    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
    • K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics

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