Two opposed parties seek to influence an uninformed decision maker. They invest in acquiring information and select what to disclose. The decision maker then adjudicates. We compare this benchmark with a procedure allowing adversarial cross-examination. A cross-examiner tests the opponent in order to persuade the decision maker that the opponent is deceitful. How does the opportunity or threat of cross-examination affect the parties' behavior? How does it affect the quality of decision-making? We show that decision-making deteriorates because parties are less likely to acquire information and because cross-examination too often makes the truth appear as falsehood. Next, we consider a form of controlled cross-examination by permitting the cross-examined to be re-examined by his own advocate, i.e., counter-persuasion. More information then reaches the decision maker. Decision-making may or may not improve compared to the benchmark depending on how examination is able to trade off type 1 and 2 errors.
Claude Fluet : Université Laval, CRREP.
Thomas Lanzi : Université de Lorraine, BETA.
For helpful comments and suggestions on an earlier version of this paper, we thank Jesse Bull, Bertrand Crettez, Andrew Daughety, Erik Talley, Navin Kartik, Kathryn Spier, Joshua Teitelbaum, and the participants of the 8th Annual Law and Economic Theory Conference 2018. Financial support from SSHRC Canada is gratefully acknowledged (grant 435-2023-1671).