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Alternative fees as a survey’s example of revealed preferences over expressed preferences

During May 2006, 162 readers of InsideCounsel completed a survey sponsored by a law firm, Butler Rubin. Asked “Do you believe alternative fee arrangements are a legitimate tool to control litigation costs?” about 84 percent of them agreed. Yet to another question, “Have you ever used alternative fee arrangements?” 40 percent admitted they had never used one. If we take this data for what it states, it illustrates an important point about statements and actions, InsideCounsel, Sept. 2006 at 31.

In terms of preferences (See my post of Sept. 17, 2006 on preferences revealed compared to expressed), many respondents expressed the answer expected of them – or which they would prefer to see themselves as holding – but their behavior contradicts that answer, since they have never varied from hourly billing.

The same gap between reality and how senior in-house lawyers would like to think they act or would like others to think they act appears in other areas, such as when asked about their use of technology, their support of diversity, their encouragement of professional development, and their commitment to good management practices of all kinds.