Abstract
Reviewing the public and private interest approaches to the regulation in the market for legal services, this article points out their mutual inconsistency and their empirical and theoretical limits. It then argues that heterogeneous legal services should be considered when (de)regulating the market. Drawing upon the distinction between credence, experience, and search goods, we distinguish various legal services according to the degree of asymmetric information on quality characterizing the relationship between lawyers and clients. We argue that the heterogeneity of legal services impacts on the desirable level of regulation, implying that not all the markets for legal services should be regulated or, conversely, deregulated. Furthermore, when regulation is needed, the degree of asymmetric information between the regulatory authority and lawyers partly determines the choice between external and self-regulation.