Playing it Safe with Low Conditional Fees Versus Being Insured by High Contingent Fees
16 Pages Posted: 3 May 2005
There are 2 versions of this paper
Playing it Safe with Low Conditional Fees Versus Being Insured by High Contingent Fees
Date Written: January 2005
Abstract
Under contingent fees, the attorney gets a share of the judgement; under conditional fees they get an upscale premium if the case is won, which is, however, unrelated to the adjudicated amount. We compare conditional and contingent fees in a framework where lawyers choose between a safe and a risky litigation strategy. Under conditional fees, lawyers prefer the safe strategy, under contingent fees the risky one. Risk-averse plaintiffs prefer conditional fees over contingent fees when lawyering costs are low and vice versa for high lawyering costs.
Keywords: Contingent fees, conditional fees, risk-aversion, insurance, incentives
JEL Classification: D82, K10
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
'Third Party Contingency' Contracts in Settlement and Litigation
By Roland Kirstein and Neil Rickman
-
'Third Party Contingency' Contracts in Settlement and Litigation
By Roland Kirstein and Neil Rickman
-
Conditional Versus Contingent Fees
By Winand Emons
-
Conditional Versus Contingent Fees
By Winand Emons
-
Playing it Safe with Low Conditional Fees Versus Being Insured by High Contingent Fees
By Winand Emons
-
The Economics of Us-Style Contingent Fees and Uk-Style Conditional Fees
By Winand Emons and Nuno Garoupa
-
The Economics of Us-Style Contingent Fees and Uk-Style Conditional Fees
By Winand Emons and Nuno Garoupa
-
Informational Externalities and Information Sharing in Class Action Suits
By Bruno Deffains and Eric Langlais
-
An Alternative to the Contingent Fee
By Harold See