On the role of plea bargaining and the distribution of sentences in the absence of judicial system frictions

This paper examines the potential role that plea bargaining may serve in an environment where trials and incarceration are costless, there is no chance of convicting innocent defendants, and coercion is not necessary to obtain further information from arrested defendants. This analysis shows that even in the frictionless judicial system environment outlined above, a risk-averse society may still find it optimal to resolve a large fraction, or even all of its cases through plea bargaining. However, this is not always the case. If defendants are generally risk-loving, mutually acceptable plea bargains may not be possible, but when they are, the plea bargain sentences will necessarily fall short of even the expected sentence from going to trial, regardless of the relative bargaining power between prosecutors and defendants.