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Article

Split-Awards and Disputes: An Experimental Study of a Strategic Model of Litigation

Journal of Economic Behavior and Organization. 2007. Vol. 63. No. 3. P. 553-572.
Nikitin M., Landeo C. M., Babcock L.

This paper studies experimentally the impact of the split-award statute, where the state takes a share of the plaintiff's punitive damage award, on litigation outcomes. Our findings indicate that dispute rates are significantly lower when bargaining is performed under the split-award institution. Defendants’ litigation losses and plaintiffs’ net compensation are significantly reduced by the split-award statute.