Legal Cost Insurance (LCI) is not only a device to reallocate risk, but also to enhance an insured's position in a settlement negotiation. The paper points out that this function of LCI is especially important in cases that have a negative expected value for potential plaintiffs. Hence LCI is of...

The papers show that Legal Cost Insurance (LCI) is a device to enhance potential litigants' bargaining position rather than to re-allocate risk. Being insured decreases the cost an insured party has to bear if settlement negotiations fail and the case goes to trial. This shifts the threat...

This paper presents a modification of the inspection game: The "Bayesian Monitoring" model rests on the assumption that judges are interested in enforcing compliant behavior and making correct decisions. They may base their judgements on an informative but imperfect signal which can be generated...

The paper provides an introduction to market economy. In comparison to other economic systems, the most important difference appears to be the existence of market prices which are created spontaneously. Hence, prices do not only provide an incentive system, but also aggregate dispersed...