An Economic Analysis of Alternative Fee Shifting Systems

Ronald Braeutigam, Bruce Owen, John Panzar
1984 Law & Contemporary Problems  
INTRODUCTION "Fee shifting" refers to the rules for deciding which party to a lawsuit will pay for the attorney fee costs of the suit.' The literature on fee shifting is extensive, and virtually every page of it contains statements or predictions concerning the effects of one fee system or another on the economic behavior of litigants or classes of litigants. 2 Most of these statements are based on intuitive reasoning; with few exceptions, 3 the literature does not contain logically rigorous
more » ... gically rigorous models of the behavioral patterns that underlie the predictions. This is hardly surprising. It is extraordinarily difficult to model the behavior of litigants. Any attempt to do so quickly makes apparent the large number of more or less arbitrary assumptions that must underlie any firm statement about the effect of one method of fee payment versus another. This paper sets out to answer with rigor some questions about four distinct fee
doi:10.2307/1191439 fatcat:qjnlvcd5yncgxhdgu7y67zwuye