Monday, January 02, 2006

Proxy Bono

Josh Sheptow, a Stanford law student, argues in a Washington Post editorial that pro bono work by high-priced lawyers is a highly inefficient means of providing legal services to the poor. It would make more sense for everyone involved if such lawyers donated their fees instead of their time.

I fully agree -- indeed, I made the same point myself a couple of years ago. I'm sure I wasn't the first to make it, but I may have been the first to have coined a good term for the practice: proxy bono. Let's see if it catches on like snowclone.

(Thanks to Don Boudreaux for the pointer.)


Sheptow said...

Nice to see that I'm not alone in the wolderness. However, the view does have some problems that I did not have space to address in the Wash. Post piece.

Admittedly, its not always the case that pro bono work could be replaced by for-profit work. Sometimes lawyers do the former only after they have finished the latter. However, even in these cases, there is a *sense* in which it is still more efficient to donate $$.

To see this, note that Lawyers at big corporate firms work overwhelming hours, often in excess of 70 per week. They also make high salaries, low to mid six-figure income for associates. Thus, given the principle of diminishing marginal returns, each additional hour of time should have lots of value (since there are very few left after work is done) and each additional $500 should have not-so-much value (since there are lots of
these left after work is done). Thus, it would be efficient from the lawyer’s OWN perspective, in addition to the perspective of the aid agency, to donate $$ rather than time.

Amy said...

It may be the case that donating the cost of X hours of a lawyer's time is worth more than donating those hours of time. However, my guess is that such a system would lower the total amount of legal service provided to the poor. The reason a lawyer agrees to do legal work for free isn't solely because she knows that someone needs free legal work. It's also that she enjoys feeling like she's helping someone, and maybe likes doing something different from her regular job a few hours a week.

A lawyer may be more likely to agree to do 5 hours of work that's challenging and different than to agree to do 5 additional hours of the same old stuff she does all day long so that she can buy 10 hours of someone else's time working on criminal cases. The act of actually doing something is more attractive than the mere knowlege that someone is being helped.

This problem comes up in other charitable arenas as well. The Red Cross turns away many donations of goods because it would rather have the money than have to worry about shipping food or clothing or toys to those who need it. The cash is more efficient, but people like the feeling of giving a teddy bear, so the charity loses out on some donors. Having a $500 a plate charity dinner is also inefficient, but people would rather go to a ball knowing that only $400 of their donation goes to cure cancer and the other $100 pays for the event than write a check for $500 and stay home that night.

The point is that the pro bono system isn't just a way to give free legal services to the poor. It's also a way to create incentives for lawyers to provide such legal advice. Allowing lawyers to give their time makes it more likely that they'll donate any resources to the cause of representation for the poor. Getting rid of the pro bono system wouldn't likely result in lawyers donating as much money as they donate now in time.