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January 10, 2005

How Judicial Elections Bias the Courts

By Alex Tabarrok

Dear David,

My research on judicial elections was provoked by this remarkable quote from retired West Virginia Supreme Court judge Richard Neely:

As long as I am allowed to redistribute wealth from out-of-state companies to injured in-state plaintiffs, I shall continue to do so.  Not only is my sleep enhanced when I give someone's else money away, but so is my job security, because the in-state plaintiffs, their families, and their friends will reelect me. Neely (1988, 4).

A typical plaintiff sues where he lives while a defendant may be a corporation that is headquartered out-of-state, perhaps even out-of-country.  Neely suggests that in these cases, elected judges will be biased towards plaintiffs - high awards are a judge's way of performing constituency service.

Furthermore, where do elected judges get most of their campaign funds?  Answer: from lawyers. Plaintiff's lawyers usually get the bad rap but even defense lawyers like to see judges who grant large awards because this drives up the demand for their services.  (A defense lawyer wants a small award in his case but he wants to operate in a field where awards in general are high.)

Eric Helland and I put these ideas to the statistical test.  Using a sample of more than 50,000 tort cases, we found that the average award against an out-of-state corporation relative to an in-state corporation is much higher (between two and four hundred thousand dollars higher) in states that select their judges using partisan elections than in states using appointment or other systems.  (Our paper from the American Law and Economics Review can be found here; email me if you can't access the journal's website and would like a copy.)

Our research suggests that judges respond to incentives just like other politicians - which raises the question, What sort of incentive structure do we want judges to have?  Appointment?  Election?  Life-time or short-term tenure?  Should campaign finance laws be stronger for state-court judges than for state representatives?  Should we rely on Federal judges more than State judges?  Our research focuses on torts but these issues also have implications for criminal law and the role of judges in Federalism.

I'm looking forward to your insights.


Posted at 12:20 PM | TrackBack (0)

Statistics/Empirical Work



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