Table of Contents

Class Actions in Context

Class Actions in Context

How Culture, Economics and Politics Shape Collective Litigation

Edited by Deborah R. Hensler, Christopher Hodges and Ianika Tzankova

In recent years collective litigation procedures have spread across the globe, accompanied by hot controversy and normative debate. Yet virtually nothing is known about how these procedures operate in practice. Based on extensive documentary and interview research, this volume presents the results of the first comparative investigation of class actions and group litigation ‘in action’, in the Americas, Europe, Asia and the Middle East.

Chapter 7: Economic enablers

Camille Cameron, Jasminka Kalajdzic and Alon Klement

Subjects: law - academic, arbitration and dispute resolution, comparative law, consumer law, law and society, law of obligations


Perhaps the most significant feature of any collective litigation regime is its economic viability: who pays, what does it cost, and does the aggregative mechanism adopted by the legislator provide the necessary incentives for pivotal actors to pursue litigation. Statutes tell us very little about the economics of class actions or the identity of the actors who economically enable class actions to exist. The case studies in this Part help fill that void. This chapter provides a comprehensive framework within which the economics of class actions can be better appreciated. First, we review the case studies. Then, we consider them within an analytical discussion of alternative class action enablers and the institutional and economic conditions for their operation. As the case studies show, the selection of enablers will differ across jurisdictions. Finally, we examine the case studies from a broader legal and doctrinal perspective of the dominant enablers in each of the case study jurisdictions. The case studies explored in this part illustrate the various mechanisms for funding class actions, and the impacts of these funding mechanisms on the initiation, conduct and resolution of class action litigation. As featured in these case studies, the identity of the enabling agent is a product of institutional and contextual factors. These factors go beyond the mere legislative framework that is apparent when reading each jurisdiction's class action law. The cases studies thus facilitate our understanding of the choices made in these jurisdictions among alternative class action enablers.

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