Advocatus, et non Latro? Testing the Excess of Litigation in the Italian Courts of Justice
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Paolo Buonanno
und
Matteo M. Galizzi
Abstract
We explore the causality relationship between litigation rates and the number of lawyers, drawing on an original panel dataset for the 169 Italian first-instance courts of justice between 2000 and 2007. In this time period, both the number of lawyers and the civil litigation rate sharply increased, and a mandatory minimum fee was in place for lawyers’ services. We first document that the number of lawyers is positively correlated with different measures of the litigation rate. Then, using an instrumental variables strategy, we find that a 10% increase in lawyers over population is associated with an increase between 1.6 and 6% in civil litigation rates. Our empirical analysis supports the supplier-induced demand (SID) hypothesis for Italian lawyers: following a sharp increase in the number of lawyers, and in the impossibility of competing on price because of the minimum fee regulation, some lawyers may have opportunistically used their informational advantage to induce their clients to bring lawsuits into court more often than would have been optimal if they were acting in the exclusive interest of their clients.
Acknowledgment
We gratefully thank Cassa Nazionale Forense for the data on the number of lawyers enrolled in their Social Security scheme; Consiglio Nazionale Forense for the data on the number of lawyers registered within each local bar association; Cassa Nazionale di Previdenza dei Dottori Commercialisti for the data on the number of business consultants enrolled in their Social Security scheme; and Consiglio Superiore della Magistratura for the data on the number of magistrates working within each first instance court of justice. We also would like to thank Silvia Dini, and her colleagues Gennuso and Brocco, of Consiglio Superiore della Magistratura, and Giovanna Biancofiore, of Cassa Nazionale Forense, for their valuable help in researching and obtaining the data. We thank Nicola Scalvini for research assistance. We are grateful to Massimiliano Bratti, Francesco Fasani, Tommaso Frattini, Raffaele Miniaci, Samantha Vignati, and participants at the SUS.DIV-FEEM-CEPR-University of Padua Conference on Economics of Culture, Institutions, and Crime (Milan), at the MILLS (Milano), and at seminars at CERGEI (Prague), University of Brescia and University of Sassari (Alghero) for many useful comments and suggestions. Paolo Buonanno also gratefully acknowledges financial support from the University of Padua (research grant CPDA071899).
Appendix
Variable descriptions and data sources
| Variables | Description | Source |
| Civil courts | First-instance ordinary civil proceedings in front of civil courts of justice per 1,000 inhabitants | Ministero della Giustizia |
| Judges of peace | First-instance ordinary civil proceedings in front of honorary judges of peace per 1,000 inhabitants | Ministero della Giustizia |
| Compensation | Litigation for civil compensation claim per 1,000 inhabitants | Ministero della Giustizia |
| Lawyers | Number of lawyers per 1,000 inhabitants | Cassa Forense |
| Judges | Numbers of judges per 1,000 inhabitants | Ministero della Giustizia |
| Length | Length of first-instance trials in days | Ministero della Giustizia |
| High school | Percentage of population with high school diploma | ISTAT |
| Associations | Number of recreational, cultural, artistic and sporting non-profit associations, each 100,000 inhabitants | ISTAT |
| Concentration | Ratio between the population living in the provincial administrative city over the population in the rest of the provincial area | Authors’ calculation on ISTAT data |
| GDP | Real GDP per capita | ISTAT and Istituto Tagliacarne |
| Employment rate | Employment rate | ISTAT |
| Density | Population density (km2) | ISTAT |
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