Litigation Without Romance: An Incentives Story
- Author(s):
- Donald J. Kochan
- Posted:
- 03-2026
- Law & Economics #:
- 26-04
- Availability:
- Full text (most recent) on SSRN
ABSTRACT:
It is a romantic notion to believe that the motivations and drivers of litigation are solely grounded in the pursuit of justice, unaffected by the realities of human nature—including individuals pursuit of self-interest, incentives, interest in identifying and willingness to take advantages within systems that might lead to gains, and the temptations to invest in shaping doctrines and institutions to create new routes or conditions to better advance their interests. Borrowing from James M. Buchanan’s Noble-prize winning work on public choice theory and his characterization of those insights as being a tale of “politics without romance,” this Article calls for adopting a view of “litigation without romance,” to coin a phrase. We should examine litigation with the same skeptical eye that public choice has demanded of legislation, understanding that it is a venue for human activity that thus naturally is not devoid of human incentives.
While the court system is designed to be available for the redress of wrongs, its ability to generate financial gains independent of, or in excess of, compensation for wrongs creates an environment where individuals are incentivized to invest in litigation as a means for profit or to achieve redistributive effects. It is basic economics to predict that individuals will invest in outcomes that are cost beneficial. This Article examines a few manifestations of these incentives within the contemporary litigation system.