Settlement

Abstract

This survey of the modeling of pretrial settlement bargaining organizes current main themes and recent developments. The basic concepts used are outlined as core models and then several variations on these core models are discussed. The focus is on articles that emphasize formal models of settlement negotiation and the presentation in the survey is organized in game-theoretic terms, this now being the principal tool employed by analyses in this area, but the discussion is aimed at the not-terribly-technical non-specialist. The survey also illustrates some of the basic notions and assumptions of information economics and of (cooperative and noncooperative) game theory.

Keywords: Settlement, Bargaining, Negotiation, Litigation

JEL Classification: K41, C70