Access to justice in revenue-seeking legal institutions
| Author | Hannah Simpson |
| DOI | http://doi.org/10.1177/09516298231162040 |
| Published date | 01 April 2023 |
| Date | 01 April 2023 |
| Subject Matter | Articles |
Access to justice in revenue-
seeking legal institutions
Hannah Simpson
Department of Politics, TexasA&M University System, College Station, USA
Abstract
Legal bias against the poor, and competition from nonstate legal services providers, can both ser-
iously affect state justice provision. But analyses of these factors often fail to incorporate a critical
feature of justice systems: states use them for revenue generation. I build a series of formal models
to understand how these factors interact. I derive several insights into empirical patterns of bias,
competition, access to justice, and legal system viability. First, in poor countries, bias can increase
access to justice and legal effectiveness. Second, given competition, poor groups will pay a pre-
mium for state-provided justice, while wealthy groups will pay a premiumfor private dispute reso-
lution. However,losing a poor group to competition is also less costly than losing a wealthy group,
and the latter loss can sometimes destroy the viability of the state justice system. These results
contribute to our understanding of state capacity and rule of law development.
Keywords
Aaccess to justice; game theory; institutions
The United Kingdom recently raised the fees charged litigants in many civil and family
court matters to amounts well above the average cost of a case to the court system, with
the goal of generating surplus revenue by taking advantage of an ‘untapped increased
willingness to pay more’(Ministry of Justice, 2013b).
1
At the same time, and for
similar reasons, it substantially cut state legal assistance for low-income individuals
(Curtis, 2010; Makinson, 2021). Both actions were criticized: the fee hikes for reducing
court access for lower-income individuals and making the state less competitive with
Corresponding author:
Hannah Simpson, Department of Politics, Texas A&M University, 4348 TAMU, College Station, USA.
Email: hannah.simpson@tamu.edu
Article
Journal of Theoretical Politics
2023, Vol. 35(2) 75–99
© The Author(s) 2023
Article reuse guidelines:
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DOI: 10.1177/09516298231162040
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private legal services providers (Bar Council, 2014; Civil Justice Council, 2015),
2
and the
legal aid cuts for forcing the poor, predominantly ethnic minorities and women, to navi-
gate complex court procedures on their own, and thereby (likely) biasing court outcomes
against them (Curtis, 2010; Makinson, 2021). But neither action was unusual.
Governments often use legal fees and fines to raise revenue (Goldstein et al., 2020;
Klerman, 2007; Rhode, 2004; Simpson, 2021). And in many countries, legal outcomes
are perceived as biased against the poor (e.g., Galanter, 1974), large number of citizens
do not, or cannot, access state justice (Rhode, 2004; de Soto, 1990), and some turn to
private adjudication mechanisms (e.g., Gambetta, 1993; de Soto, 1990).
How does a state’s pursuit of revenue interact with factors such as legal bias and com-
petition from private providers to shape citizen access to the legal system? Because
citizen participation in, and acceptance of, a legal system is what gives the law its
power (e.g., Calvert, 1995; Mailath et al., 2017; Tyler, 2003), answering this question
may help us understand not only when citizens’rights are well-protected by the state,
but also what determines the effectiveness, and even the survival, of the legal system
itself. Yet the complex causal relationships between a state’s revenue motive and these
other legal features make answers difficult to find. Whether private legal providers
emerge to compete with the state justice system (in addition to emerging when state
justice is nonexistent, as in Greif (1989) or Milgrom et al. (1990)) or the state has a mon-
opoly on justice provision, citizen access to justice is likely primarily determined by a
combination of legal fee structures, legal bias, and the effectiveness of the relevant
legal system (e.g., Galanter, 1974; Rhode, 2004; de Soto, 1990). But access fees, bias,
and effectiveness are all shaped by economic conditions, such as average citizen
wealth and income inequality, which are themselves endogenous to the quality of prop-
erty protection provided by the legal system (e.g., Acemoglu et al., 2001; North, 1990),
and a legal system’s effectiveness additionally depends on citizens’acceptance of it
(Calvert, 1995; Tyler, 2003).
As a first step in answering this question, I construct a series of formal models of state
justice provision. I begin by proposing a sparse, benchmark model that incorporates the
two most basic features discussed above: state use of the legal system to generate
revenue, and a legal system’s functional dependence on citizen participation in it. In
the benchmark, the state selects a flat-rate fee citizens must pay to access justice, and
each member of a population of citizens, differentiated by wealth, chooses whether or
not to pay the fee. The legal system’s effectiveness—conceptualized as the probability
that it enables a citizen to engage in profitable economic activity—increases with the frac-
tion of the country that buys into the institution. I assume the state may also independ-
ently value citizen access to the legal system, either because it is normatively
appealing or because providing citizens access to justice may help to build political legit-
imacy (e.g., Tyler, 2006) or support (e.g., Simpson, 2021).
After deriving the baseline conditions under which citizens obtain (or lack) access to
an unbiased, revenue-seeking legal system with a monopoly on justice provision, I extend
the model in several directions. First, I incorporate legal system bias in favor of wealthier
citizens into the model by allowing the quality of rights protection to vary with citizens’
wealth, and compare equilibrium access levels in biased and unbiased systems. Legal
institutions may be biased in favor of the wealthy for at least three reasons. First, in
76 Journal of Theoretical Politics 35(2)
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