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The New Palgrave Dictionary of Economics pp 1–12Cite as

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Litigation, Economics of

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Abstract

This article begins by introducing the basic economic framework for studying litigation and out-of-court settlement. One set of issues addressed is positive (or descriptive) in nature. Under what conditions will someone decide to file suit? When do cases settle out of court? Normative issues are also addressed. Are these private litigation decisions in the interest of society more broadly? Next, the article surveys some of the more active areas in the litigation literature including rules of evidence, loser-pays rules, appeals, contingent fees for attorneys, alternative dispute resolution, class actions, and plea bargaining.

This chapter was originally published in The New Palgrave Dictionary of Economics, 2nd edition, 2008. Edited by Steven N. Durlauf and Lawrence E. Blume

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Acknowledgment

The author thanks the Searle Fund for financial support.

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    Kathryn E. Spier

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    Spier, K.E. (2008). Litigation, Economics of. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_2492-1

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    • DOI: https://doi.org/10.1057/978-1-349-95121-5_2492-1

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