Elisabetta Iossa, and Bruno Jullien, “The Market for Lawyers: On the Value of Information on the Quality of Legal Services”, The RAND Journal of Economics, vol. 43, n. 4, 2012, pp. 677–705.
We study the functioning of the market for lawyers, considering the strategic interaction among litigants, lawyers, and judges. We investigate the value of legal representation and of systems of quality certification, such as the Queen’s Counsel system. In our setting, higher quality lawyers obtain better-quality evidence and are better able to interpret it. Judges receive information from the lawyers and have reputational concerns. We show that reputational concerns generate a decision bias in favor of certified lawyers and that this causes misallocation of lawyers at the market equilibrium. As a result, whereas a higher quality of lawyers increases welfare, public information over quality may be welfare reducing.
Elisabetta Iossa, and Bruno Jullien, “The Market for Lawyers: The Value of Information on the Quality of Legal Services.”, IDEI Working Paper, n. 485, November 2007.