Sarvagya Jha, Rutgers University, New Jersey, USA
ABSTRACT
In this paper, I examine the application of game theory to legal disputes over financial contracts, offering a novel perspective on the strategic interactions that shape litigation outcomes in the financial sector. By leveraging game- theoretic models, I analyze the decision-making processes of parties involved in contract disputes, including plaintiffs, defendants, and judiciary bodies. My research explores how these models can be used to predict litigation strategies, inform settlement negotiations, and anticipate judicial decisions in the context of complex financial agreements.
I begin by establishing a theoretical framework that bridges game theory concepts with legal principles relevant to financial contract disputes. I then apply this framework to various scenarios, including securities fraud litigation and derivative contract conflicts, demonstrating how game theory can provide insights into the behavior of rational actors under conditions of uncertainty and information asymmetry.
My findings suggest that game theory offers a valuable analytical tool for understanding and navigating the intricacies of legal conflicts in the financial domain. By illuminating the strategic underpinnings of dispute resolution, this research contributes to both academic discourse and practical applications in law and finance. I conclude by discussing the implications of my analysis for legal practitioners, policymakers, and researchers, while also acknowledging the limitations of game-theoretic approaches and proposing avenues for future research.
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