Information Costs and the Civil Justice System

53 Pages Posted: 31 Jul 2018 Last revised: 8 Aug 2018

See all articles by Keith N. Hylton

Keith N. Hylton

Boston University - School of Law

Date Written: July 31, 2018


Litigation is costly because information is not free. Given that information is costly and perfect information prohibitively costly, courts will occasionally err. Finally, the fact that information is costly implies an unavoidable degree of informational asymmetry between disputants. This paper presents a model of the civil justice system that incorporates these features of the real world and probes its implications for compliance with the law, efficiency of law, accuracy in adjudication, trial outcome statistics, and the evolution of legal standards. The model’s claims are applied to and tested against the relevant empirical and legal literature.

Keywords: optimal deterrence, efficiency of law, trial win rates, trial selection, legal evolution, litigation costs, legal compliance, judicial error, incentive to appeal

JEL Classification: D74, K10, K13, K41

Suggested Citation

Hylton, Keith N., Information Costs and the Civil Justice System (July 31, 2018). Boston Univ. School of Law, Law and Economics Research Paper No. 18-17, Available at SSRN: or

Keith N. Hylton (Contact Author)

Boston University - School of Law ( email )

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