Economic considerations pervade decisions to sue, to go to court, or to settle. The monetary and nonmonetary costs, offset by estimates of the magnitude and probability of gain, may be expected to shape the contours of litigation and decisions to litigate. Dr. Rubinfeld seeks to examine the influence of economic factors through theoretical and empirical study. First, given extant research, writing, and conjecture on these issues, he plans to undertake a critical and synthetic assessment of the literature on the economics of litigation, (a) focusing on the uses and misuses of economic tools and ideas and (b) developing an agenda for future inquiry. Second, he plans a series of theoretical efforts aimed at (a) incorporating settlements and litigation into the current theory of optimal public enforcement and (b) exploring the benefits of trial rather than settlement. Third, using a data set of antitrust cases filed in six Federal District Courts over a thirteen-year period (supplemented by survey data of attorneys and participants), he plans rigorous econometric analysis of the economic underpinnings of the litigation process. In this empirical work, Dr. Rubinfeld will focus on the estimation of a set of settlement and trial outcome equations incorporating such issues as selection bias (in the kinds of cases that go to trial), the influence of reputational factors associated with the defendant and plaintiff, and the effect of perceptions prior to trial on trial outcome. Bringing substantial theoretical and econometric expertise, Dr. Rubinfeld is especially well situated to add to the scientific discourse regarding litigation and when, why, and how it is used.
