High-Powered Attorney Incentives: A Look at the New Indigent Defense System in South Carolina

Abstract

This paper analyzes how attorneys respond to a change in payment structures. In November of 2012, the South Carolina Indigent Defense system underwent major changes. Included in these changes, attorneys would now be paid a flat fee instead of an hourly rate. This paper builds on Lazear's (2000) work which empirically studied how incentives affect worker behavior. Using case-level data provided by the South Carolina Commission on Indigent Defense, I analyze how this change affects the number of hours reported and how in-court behavior changes. I find that attorneys report about 30% less hours when paid a flat fee and they are about 20% less likely to go to court.

Keywords: Indigent Defense, High-Powered Incentive, Lawyers

JEL Classification: K40, J33