Narrower Door to Approach the 50%: Cost-benefit-screened Litigation and Plaintiff Win Rate

Narrower Door to Approach the 50%: Cost-benefit-screened Litigation and Plaintiff Win Rate | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Narrower Door to Approach the 50%: Cost-benefit-screened Litigation and Plaintiff Win Rate Bin Ye, Jinchuan Shi, Yiran Ma This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6919376/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract As it pertains to court cases, the predilection toward a 50% plaintiff win rate is a well-known proposition, first put forward in the Priest-Klein theory (Priest and Klein 1984). Numerous studies have verified this proposition by analyzing the relationship between litigation rates and judgments. However, the question remains as to whether any change in litigation rates, triggered by any factor, would cause the plaintiff win rate to trend towards 50%. The present study aims to contribute to the existing body of knowledge by conducting a theoretical analysis and empirical tests to explore the influencing mechanism of the Priest-Klein theory on judgments. In the theoretical analysis, the mechanism of the litigation selection on the judgment is reformulated by distinguishing between estimation-error-screened litigation and cost-benefit-screened litigation. The former involves lawsuits that prioritize disputes with more uncertain outcomes, resulting in judgments that approximate the 50% plaintiff win rate. In contrast, the latter involves lawsuits that prioritize disputes with more certain outcomes, leading to judgments that deviate significantly from the 50% plaintiff win rate. In the empirical tests, the influence of the cost-benefit-screened litigation on judgments as opposed to the original Priest-Klein theory is verified by taking the cost-benefit ratio of litigation as the observation in China’s commercial lawsuits. This finding serves to improve our understanding of the Priest-Klein theory by elucidating that the decline in litigation probability engendered by the cost-benefit ratio cannot invariably result in a 50% win rate for the plaintiff. JEL classification numbers: K15, K41, P48 Priest-Klein theory cost-benefit-screened litigation plaintiff win rate Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-6919376","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":473477470,"identity":"5aded9f6-d61b-4017-a238-0b9df877a834","order_by":0,"name":"Bin Ye","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA2klEQVRIie3RsWrDMBDG8TMCeVHj9Zakr6BiMAHnYU4ElCVk9lCooODVc98ij6Bg8KSQNaOmzBkzldqeMtnqVqj+2wf3mw4gFvuDcZZ5SxI/GgDqN5sni1Qk3leb5MuEklUm2Jt3OjnacQcQzl46VHXL8ou9IVSlMunZzpCFHggvrNUIbqeMONAMgWIgojgZjUndKoNCBhHMP6En30FE5JKclpIPxAQRrjxVG0IH2zV1u7wW+2ny2rT29JBIWePU9f5eLpvUTZOnBI3P5KH3fan9xXEsFov9p34AkSRBSRNlK0cAAAAASUVORK5CYII=","orcid":"","institution":"Zhejiang University of Science and Technology","correspondingAuthor":true,"prefix":"","firstName":"Bin","middleName":"","lastName":"Ye","suffix":""},{"id":473477471,"identity":"b01df352-1f44-4062-b145-4298f6a6735e","order_by":1,"name":"Jinchuan Shi","email":"","orcid":"","institution":"Zhejiang University","correspondingAuthor":false,"prefix":"","firstName":"Jinchuan","middleName":"","lastName":"Shi","suffix":""},{"id":473477472,"identity":"f609c8be-bff6-48c7-bdd8-5eb358d3a944","order_by":2,"name":"Yiran Ma","email":"","orcid":"","institution":"Zhejiang University","correspondingAuthor":false,"prefix":"","firstName":"Yiran","middleName":"","lastName":"Ma","suffix":""}],"badges":[],"createdAt":"2025-06-18 05:38:15","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-6919376/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-6919376/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":89754647,"identity":"bd17f2ad-9132-4ce2-a1f2-569cdb9d2cd8","added_by":"auto","created_at":"2025-08-24 08:23:52","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":821312,"visible":true,"origin":"","legend":"","description":"","filename":"NarrowerDoortoApproachthe50CostbenefitscreenedLitigationandPlaintiffWinRate.pdf","url":"https://assets-eu.researchsquare.com/files/rs-6919376/v1_covered_4303a325-f3d2-4434-b1d9-9ea2ce581862.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Narrower Door to Approach the 50%: Cost-benefit-screened Litigation and Plaintiff Win Rate","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Priest-Klein theory, cost-benefit-screened litigation, plaintiff win rate","lastPublishedDoi":"10.21203/rs.3.rs-6919376/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-6919376/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eAs it pertains to court cases, the predilection toward a 50% plaintiff win rate is a well-known proposition, first put forward in the Priest-Klein theory (Priest and Klein 1984). Numerous studies have verified this proposition by analyzing the relationship between litigation rates and judgments. However, the question remains as to whether any change in litigation rates, triggered by any factor, would cause the plaintiff win rate to trend towards 50%. The present study aims to contribute to the existing body of knowledge by conducting a theoretical analysis and empirical tests to explore the influencing mechanism of the Priest-Klein theory on judgments. In the theoretical analysis, the mechanism of the litigation selection on the judgment is reformulated by distinguishing between estimation-error-screened litigation and cost-benefit-screened litigation. The former involves lawsuits that prioritize disputes with more uncertain outcomes, resulting in judgments that approximate the 50% plaintiff win rate. In contrast, the latter involves lawsuits that prioritize disputes with more certain outcomes, leading to judgments that deviate significantly from the 50% plaintiff win rate. In the empirical tests, the influence of the cost-benefit-screened litigation on judgments as opposed to the original Priest-Klein theory is verified by taking the cost-benefit ratio of litigation as the observation in China’s commercial lawsuits. 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