The Regressive Effect of Appealability
16 Pages Posted: 9 Oct 2010 Last revised: 22 Dec 2011
Date Written: December 21, 2011
Abstract
This paper makes the point that a court decision that is open for appeal is actually equivalent to a take-it-or-leave-it settlement proposal to both parties. In order that the case will not be appealed they both need to "take", i.e., accept, this proposal. Thus, a right to appeal actually activates the regressive effects that characterize settlements, also with respect to lower-court decisions. Legal Uncertainty has a regressive effect on lower court decisions: if the judge wishes to block appeals in order to protect one party's interest, her own self-interest, or the system's interest, her decision will be regressively biased relative to the higher-court decision. In fact this could happen also without strategic judges, but as an evolutionary process: the survival power of regressive decisions is stronger in a legally uncertain regime.
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