Justice: Greater Access, Lower Costs
37 Pages Posted: 24 Jan 2014
Date Written: January 23, 2014
Litigation imposes large costs on society; this justifies settlement considerations. In any case, access to justice is critical to socioeconomic development; as such, it needs to be balanced with litigation minimization. This study examines the tradeoff between litigation and access to justice and explicitly elucidates their relationship. In considering access issues, this study finds that the outcomes of policies that affect parties’ litigation decisions partially depart from those in the standard literature. For instance, increasing parties’ litigation costs does not necessarily promote settlement in the shadow of the court. Rather, effects depend on the elasticity of the demand for legal remedies. Furthermore, even while pushing litigation, enhancing access to justice is efficient as long as the claimant’s marginal propensity to litigate is smaller than the social opportunity-cost of access to justice. This finding offers further insight into the suitability of litigation subsidization through legal aid.
Keywords: access to justice, litigation, settlement, elasticity
JEL Classification: K41
Suggested Citation: Suggested Citation