A Note on Trial Delay and Social Welfare: The Impact of Multiple Equilibria
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.
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- 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.
- Lucian Arye Bebchuk, 1984. "Litigation and Settlement under Imperfect Information," RAND Journal of Economics, The RAND Corporation, vol. 15(3), pages 404-415, Autumn.
- 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.
- 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.
- Nathalie Chappe & Marie Obidzinski, 2013. "The impact of the number of courts on the demand for trials," Working Papers 2013-01, CRESE.
- 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.
- 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)
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