We present, for the first time, a model of recent institutional developments in litigation funding across several European jurisdictions. Recognizing the financing constraints that British cost rules may impose on litigants, these new contractual arrangements combine contingency fees with third...

This paper analyzes the impact of FORIS contracts on litigation and settlement decisions using a simple divergent-expectations model. A FORIS contract introduces contingent fee arrangements under the British legal cost allocation rule: the plaintiff pays a percentage of his settlement or trial...

This paper asks whether lawyers respond to financial incentives in ways that are consistent with predictions from contract theory. It uses data collected from before/after the introduction of standard fees for legal aid lawyers in England and Wales. For some inputs (not all), these substituted...

In a Dynamic setting, we compare procurement schemes in the form of a lump-sum payment with an optimal information-revealing menu of contracts without commitment. We find that lump-sum contracts generate two benefits. First, they always provide optimal levels of effort. Second, they 'tie the...