Working Paper: NBER ID: w3005
Authors: Louis Kaplow; Steven Shavell
Abstract: Much legal advice is provided after individuals have committed acts -- when they come before a tribunal -- rather than at the time they decide how to act. This paper considers the effects and social desirability of such legal advice. It is emphasized that 1egl advice tends to reduce expected sanctions, which may encourage acts subject to sanctions. There is, however, no a priort basis for believing that this is socially undesirable, because, among other reasons, it may be possible to raise the level of sanctions to offset their dilution due to legal advice. In addition, legal advice has no general tendency to improve the effectiveness of the legal system through its influence on the information presented to tribunals.
Keywords: legal advice; expected sanctions; social welfare; deterrence
JEL Codes: K00; K41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Legal advice (K36) | Expected sanctions (F51) |
| Expected sanctions (F51) | Engagement in acts subject to sanctions (Z28) |
| Legal advice (K36) | Engagement in acts subject to sanctions (Z28) |