Litigation and Settlement in a Game with Incomplete Information

An Experimental Study

  • Wolfgang Ryll

Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 440)

Table of contents

  1. Front Matter
    Pages I-VIII
  2. Wolfgang Ryll
    Pages 1-5
  3. Wolfgang Ryll
    Pages 31-76
  4. Wolfgang Ryll
    Pages 77-97
  5. Wolfgang Ryll
    Pages 141-142
  6. Back Matter
    Pages 171-176

About this book


We investigate a two-person game of litigation and settlement with incomplete information on one side. So far, various theoretical attempts have been made to answer the question of why some people choose not to resolve their disputes and instead go to court and incur litigation costs, even if bargaining leaves room for both parties to fare better when avoiding the conflict. We can distinguish between games which focus on strategic elements like games with incomplete information (see, for example, P'ng (1983), Samuelson (1982) and Schweizer (1989» and decision-theoretic models neglecting strategic elements (see, for example, Landes (1971) and Gould (1973». The single-person decision theory approach to litigation assumes litigants to have a subjective estimate of the likelihood that the plaintiff will win the action. Differing views on the probability of winning the court case help to explain the fraction of cases that actually go to trial. Among others, P'ng (1983) points out the shortcomings of the single-person decision theory approach which does not take into account, for example, the different fee systems in England and the U.S. and the differences in information conflicting parties may have. P'ng constructs a model of one-sided incomplete information where the settlement terms are given exogenously. Schweizer (1989), on the other hand, extends P'ng's model and allows for two-sided asymmetric information where the settlement terms are determined endogenously.


Experimentelle Wirtschaftsforschung Game Theory Spieltheorie economics equilibrium experimental economics incomplete information modeling simulations strategy unvollständige Information

Authors and affiliations

  • Wolfgang Ryll
    • 1
  1. 1.Bad Homburg v.d.H.Germany

Bibliographic information

  • DOI
  • Copyright Information Springer-Verlag Berlin Heidelberg 1996
  • Publisher Name Springer, Berlin, Heidelberg
  • eBook Packages Springer Book Archive
  • Print ISBN 978-3-540-61304-6
  • Online ISBN 978-3-642-61467-5
  • Series Print ISSN 0075-8442
  • Buy this book on publisher's site