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Please use this identifier to cite or link to this item: http://hdl.handle.net/1959.3/204569
- Applying the Kelly criterion to lawsuits
- Barnett, Tristan
- This article analyses the risks and rewards involved in the litigation process, and whether it is beneficial for a victim to file a lawsuit against the injurer given there are risks involved if unsuccessful in court. The analysis can be used to determine whether a victim should have legal representation in court to obtain a higher expected payout, or minimize risk through legal costs by representing themselves in court, even though the expected payout is reduced without legal representation. Analysis is given to obtain insights as to how much a victim should accept in an out-of-court settlement. A working example from an employment dispute is given to demonstrate the methodology.
- Publication type
- Journal article
- Law, Probability and Risk, Vol. 9, no. 2 (Jun 2010), pp. 139-147
- Publication year
- FOR Code(s)
- 1801 Law
- Casino mathematics; Dispute resolution; Kelly criterion; Litigation; Negotiation; Out-of court settlement; Risk-averse strategies; Risk taking
- Oxford University Press
- Publisher URL
- Copyright © The Author . Published by Oxford University Press.
- Peer reviewed