Are pain and suffering awards (un-)predictable? : evidence from Germany

This paper assesses the widely held belief that damages for pain and suffering are random or arbitrary. We empirically analyze the differential impact of a plaintiff's personal characteristics, pain-specific circumstances and a lawsuit's procedural features on such payments. Relying on a dataset of about 2,200 pain and suffering verdicts from Germany between 1980 and 2006, we observe that final awards are systematically influenced by the injury's conditions (most importantly the intensity and severity of damage), while individual characteristics such as gender and age turn out insignificant. Regarding the lawsuit, it appears to be relevant at which court level the case is brought in and whether the plaintiff hires a lawyer or not. On balance, our findings suggest that compensations are consistent with the legal framework of the German tort law, letting us conclude that damages for pain and suffering are widely predictable rather than random.