A COST-BENEFIT ANALYSIS OF ENLARGING THE JAPANESE JUDICIAL SYSTEM
This article presents a cost-benefit analysis of enlarging the Japanese judicial system, especially the civil section of District Courts (CSDC). Constructing a simple econometric model of CSDC, the effects of increase of judges on the supply of judicial services and the trial time are analyzed. Then a cost and benefit calculation is done. The basic assumption is that the total benefit of the judicial system is the aggregate of monetary value of a suit (MVS). The main conclusions are: (1) The demand elasticity for a civil trial with respect to trial time is -"1.3" to about -"1.4", and its income elasticity is 0.95. (2) The supply of civil trials is proportional to the number of judges. (3) Ten-percent increase of judges will shorten the average trial time by 5.2%. (4) The net benefit of CSDC is estimated to be ¥466 billion per year if the annual discount rate is 10%. (5) Judging from the demand and supply relation, if CSDC is doubled, the net increase of total benefit per year will be ¥543 billion. (6) If the benefit of the external effect on lawyers' market is added, the total net benefit will reach almost ¥1 trillion, which is 0.22% of gross domestic product. Copyright 2002 Western Economic Association International.
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