Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/103849 
Year of Publication: 
2013
Series/Report no.: 
Discussion Papers No. 13-06
Publisher: 
University of Bern, Department of Economics, Bern
Abstract: 
Victims want to collect damages from injurers. Cases differ with respect to the judgment. Attorneys observe the expected judgment, clients do not. Victims need an attorney to sue; defense attorneys reduce the probability that the plaintiff prevails. Plaintiffs' attorneys offer contingent fees providing incentives to proceed with strong and drop weak cases. By contrast, defense attorneys work for fixed fees under which they accept all cases. Since the defense commits to fight all cases, few victims sue in the first place. We thus explain the fact that in the US virtually all plaintiffs use contingency while defendants tend to rely exclusively on fixed fees.
Subjects: 
litigation
contingent fees
fixed fees
expert services
JEL: 
D82
K41
Document Type: 
Working Paper

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