An informational theory of judicial organization

This dissertation develops an informational theory of the organization of a hierarchical judicial system. The theory conceives of a court system as a hierarchy of ideologically motivated judges with a division of labor between trial courts and appellate courts. Trial courts "specialize" in finding the facts of individual cases, and therefore develop private information about the facts of cases not observable by the appeals courts. The appeals courts review lower court cases and draw inferences about the "true" facts based on the findings of fact and conclusions of law rendered by the trial courts. The findings of fact and conclusions of law take place against the backdrop of ideological disagreement between the courts, both about the resolution of individual cases and about the legal precedent set by the case. The problem of ideological disagreement between appellate court principals and trial court agents makes credible information communication about case facts potentially problematic.;The predictions are tested using a new dataset on judicial fact findings in the federal courts. Consistent with the model's prediction the empirical analysis suggests that reversals of findings of fact are indeed significantly more ideological than reversals of legal doctrine. The evidence suggests that the review of "facts" of cases, which is seen by much legal scholarship as non-ideological and almost perfunctory in nature, is actually quite ideologically polarizing. The ideological effect for review of factual findings, moreover, does not seem to extend to other deferential forms of appellate review, such as abuse of discretion review of lower court rulings on evidence and procedure. Thus, the ideological effect appears to have a connection to the asymmetric information in review of facts, as hypothesized in the formal model.;More generally, the model formalizes the familiar legal concepts of "law," "facts," and "holdings" in the development of legal doctrine---concepts crucial to legal thought---that have not typically made their way into formal models of the judiciary. This approach sheds new light on a variety of important institutional features in the judiciary, such as why appeals courts generally defer to trial courts on factual findings (but not conclusions of law), how to distinguish the concepts of "dicta" and "holding," as well as the implications of rules versus standards in a hierarchical context. The theory suggests that institutions of deference to findings of fact create the conditions for credible communication of information about individual fact patterns in the judicial hierarchy.;The theory suggests some counterintuitive predictions about behavior in the judicial hierarchy. First, the model suggests that the lower courts' findings of fact should be more ideologically motivated than lower courts' conclusions of law. The asymmetric information of the trial courts with respect to the facts of individual cases offers opportunities for manipulating case outcomes, whereas the easily observable legal doctrine does not. Second, the model suggests that lower court judges will have opportunities to credibly communicate their private information in appropriate circumstances by sending a costly signal about the true state of the facts. The institutionalized rule of deference to trial court findings of fact, together with the concept of legal doctrine, creates the conditions for credible communication of private information. In short, the model suggests that the institutions of deference to trial court findings of fact are rational institutional responses to the endemic problem of asymmetric information in the judicial hierarchy.