Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

Surely that's an opportunity for a new firm? The demand is obviously there (plenty of people don't see a lawyer for financial reasons), as is the supply (apparently).

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#5

Post by simonbrown » Tue, Mar 06, 2012, 9:07 PM UTC

mirceagoia wrote: post #3

puppop wrote: post #2

Because there are no H-1B lawyers.

Do you think lawyers from other countries know US law? I don't think so. You will pretty much have to start over in US.

They would probably be prepared to learn it, if it paid. IANAL, but I'm guessing the main problem would be legal limitations.

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#6

Post by jerrya » Tue, Mar 06, 2012, 9:08 PM UTC

This may not apply to the world of corporate lawyers the answer seems to be about, but at a smaller level, there are enormous switching costs involved in moving away from, and training a new lawyer.

And it's not a free market. In a free market, the consumer can walk away from a purchase. Most times individuals or small businesses need a lawyer, they are in no position from walking away. They need a lawyer. And they need to stop spending time searching, and get on with resolving.

So a lot of claims from lawyers that they operate in a free market are really not true. They mistake what are basically extortion/price gouging rates for free market pricing.

And the search is expensive too, with few (?) lawyers willing to offer 30 min to an hour of their time to discuss your needs for free. This is another factor in increasing switching costs for the consumers.

And of course, price is used as a signal for quality in a market in which quality is very hard to measure by most consumers. Sure I got a great deal on a lawyer, he only charges $150 per hour. Hmm, Your lawyer charges $400 per hour? Now, I'm not so confident.

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#7

Post by bonesinger » Tue, Mar 06, 2012, 9:10 PM UTC

This article misses one point, law school is expensive!

Students generally will want to pay their 6-figure debts with a matching salary.

When you don't have to worry about a huge debt, it allows you to be riskier and try other avenues, such as public interest, or work in small lesser known industries

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#8

Post by nextparadigms » Tue, Mar 06, 2012, 9:11 PM UTC

Any way this market can be disrupted? Maybe through some more efficient/decentralized/AI-based services that would do much of the lawyer's jobs, forcing them to reduce their billing rates?

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#9

Post by tikhonj » Tue, Mar 06, 2012, 9:16 PM UTC

bonesinger wrote: post #7

This article misses one point, law school is expensive! Students generally will want to pay their 6-figure debts with a matching salary. When you don't have to worry about a huge debt, it allows you to be riskier and try other avenues, such as public interest, or work in small lesser known industries

The article did mention student loans. Also, I can't help thinking that the reason law school can be so expensive is that the students can then get overpaid jobs and pay it back.

Re: Why Are Lawyers So Expensive Even With The Excess Supply Of Lawyers?

#10

Post by mirceagoia » Tue, Mar 06, 2012, 9:19 PM UTC

nextparadigms wrote: post #8

Any way this market can be disrupted? Maybe through some more efficient/decentralized/AI-based services that would do much of the lawyer's jobs, forcing them to reduce their billing rates?

There are services like legalzoom.com ...but they didn't seem to make a scratch in this world. Or at least not big enough.