Settlements Under Unequal Access to Justice

71 Pages Posted: 12 Jun 2020

See all articles by Madina Kurmangaliyeva

Madina Kurmangaliyeva

TILEC; Department of Economics, Tilburg University; European University at St. Petersburg (EUSP)

Anastasia Antsygina

National Research University Higher School of Economics

Date Written: June 8, 2020

Abstract

Settlements among parties are usually regarded as an efficient solution to a judicial dispute. However, frequent settlements between the rich and the poor can also mean unequal access to justice. We develop a model of settlements that takes wealth disparity of the parties into account, as the defendant and the victim must expend resources in court. Richer litigants can drive a harder bargain, and achieve more favorable settlement price. There has been surprisingly little evidence of this price effect in the empirical literature, likely due to the non-random selection of cases into court or private nature of settlements. We empirically show that this price effect exists by exploiting (1) the blurred line between civil and criminal litigation in Russia; (2) traffic collisions, where parties of different wealth are matched at random; and (3) the status of policemen, whose insider knowledge make them more powerful litigants, while lacking wealth for large settlements. We find that policemen settle more (less) often as defendants (victims) than their comparable wealth group,
in line with the model’s prediction. The existence of the price effect highlights
institutional failures, and is especially worrying for intentional offenses.

Keywords: access to justice, settlements, wealth inequality, litigation, structural, estimation

JEL Classification: K14, K15, K41

Suggested Citation

Kurmangaliyeva, Madina and Antsygina, Anastasia, Settlements Under Unequal Access to Justice (June 8, 2020). TILEC Discussion Paper No. DP2020-016, Available at SSRN: https://ssrn.com/abstract=3619989 or http://dx.doi.org/10.2139/ssrn.3619989

Madina Kurmangaliyeva (Contact Author)

TILEC; Department of Economics, Tilburg University ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

HOME PAGE: http://www.madinak.com

European University at St. Petersburg (EUSP) ( email )

3 Gagarinskaya Street
St. Petersburg, 191187
Russia

Anastasia Antsygina

National Research University Higher School of Economics ( email )

136, Rodionova street
25/12, Bolshaya pecherskaya street
Nizhniy Novgorod, 603155
Russia

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
17
Abstract Views
175
PlumX Metrics