Wolfgang Ryll

Litigation and Settlement in a Game with Incomplete Information

An Experimental Study

• Broschiertes Buch

Produktbeschreibung

The book investigates a two-person game of litigation and settlement with incomplete information on one side. The experimental design allows investigation of how subjects solve the bargaining problem. A prominence level analysis is applied to the data and suggests that subjects tend to choose "round" numbers. It is shown that there exists a correlation between machiavellianism and subjects' adjustment behaviour in the game. The learning behaviour is discussed extensively. Plaintiffs' acceptance limits polarize at the beginning of the second play. A model of learning direction theory applied to explain subjects's behaviour over the course of the game.

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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.

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Produktdetails

• Lecture Notes in Economics and Mathematical Systems 440
• Verlag: Springer / Springer Berlin Heidelberg / Springer, Berlin
• Artikelnr. des Verlages: 978-3-540-61304-6
• 1996.
• Seitenzahl: 188
• Erscheinungstermin: 12. Juli 1996
• Englisch
• Abmessung: 235mm x 155mm x 11mm
• Gewicht: 286g
• ISBN-13: 9783540613046
• ISBN-10: 3540613048
• Artikelnr.: 09219057

Inhaltsangabe

1. Introduction.- 2. The Game-Theoretic Model and Equilibrium Sets.- 2.1 The Game Model.- 2.2 Pure Strategy Equilibria.- 2.3 One-Step and Iterative Elimination of Weakly Dominated Strategies.- 3. Experimental Design and Organisation of the Experiment.- 4. Experimental Results.- 4.1 General Results.- 4.2 Behavioural Characteristics and Learning Behaviour.- 5. Learning Theories.- 5.1 Alternative Approaches to Learning.- 5.2 A Descriptive Theory for the Adjustment Behaviour.- 5.3 Deviations from Direction Learning.- 5.4 Learning Theory of the Polarization Effect.- 5.5 Discriminant Analysis of the Polarization Effect.- 5.6 Summary Of Experimental Findings.- 6. Monte-Carlo Simulations and Testing of Learning Direction Theory Against a Simple Alternative Theory.- 6.1 Monte-Carlo Approach to our Models of Learning Direction Theory and the Simple Alternative Theory.- 6.2 Modeling of Direction Learning and the Experimental Design.- 6.3 Estimation of the Adjustment Curves of Inexperienced and Experienced Subjects.- 6.4 Relative Frequencies of Deviations from Direction Learning.- 6.5 Increments of Settlement Offers and Acceptance Limits.- 6.6 Tests for the Comparison of the Two Alternative Theories.- 7. Comparison of the Results of Direction Learning and the Simple Alternative Theory.- 7.1 Results of the First Play.- 7.2 Results of the Second Play.- 7.3 Results of the Third Play.- 7.4 Summary of the Simulations and the Comparison of the Two Theories.- 8. Summary.- Appendix A.- Appendix B.- Appendix C.- Appendix D.- References.