1. Econometric analysis of the benefits of early legal advice
Keith Blakemore (Law Society) and Anna Sperati (Ipsos MORI)
13 June 2018

2. Aims of the research
The initial aim of the research was to assess the full benefits of early professional legal advice.
However, the data available meant that at this stage we had to focus on the speed of resolution of issues.
Other indicators of the benefits of early advice tried were:
People’s satisfaction with the final outcome of issues – but satisfaction was often correlated with whether issues were resolved in people’s favour or not
The monetary benefits of early advice – but significant additional data would have needed to have been acquired, particularly on the ‘knock-on’ effects of issues being resolved early
The analysis of was undertaken by Ipsos MORI and the Law Society Research Unit

3. Main dataset used
We used data from the Law Society/LSB 2015 Legal Needs Survey
Fieldwork undertaken 1 October 2015 – 24 December 2015
29 different types of issue covered
Responses from 8,912 individuals in England & Wales
Data on 16,694 issues in total
Respondents recruited from the Ipsos MORI online panel
Data not weighted at respondent level – although corrections applied where certain issues were deliberately over-sampled in order to achieve sufficient sample sizes
Data that was asked at a respondent level remains unweighted and no weights were used to deal with non-response or to make the sample match the population of England and Wales; therefore, the results are not nationally representative and are not fully generalizable to the broader population. Findings presented at respondent level include socio-demographics, prevalence of issues and awareness of legal services providers. Findings in relation to the issues experienced are based on weighted data, the weight being used to correct for the differential probabilities of being asked about specific issues as respondents were able to answer questions on a maximum of three issues.

4. Dataset used for this analysis
Data used for a subset of 17 issues, where there was
sufficient sample sizes
sufficient questions were completed on
date of issue first occurring
date when legal advice obtained
date of resolution of issue
other controlling factors used in the analysis
Data on 2,757 issues therefore used in this research

5. How issues were resolved, and how many issues people sought legal advice for

6. Definition of ‘early legal advice’
No accepted definition of ‘early legal advice’ exists
Based on inspection of the data, we defined ‘early legal advice’ as professional legal advice received within 3 months of the issue first occurring
Definition was also checked that it made sense in terms of Law Society experts’ experiences of dealing with legal issues
Breakdown of data between issues where early advice received, and issues where early advice not received

7. Methodology 2 main aspects to the analysis: (1) Survival analysis
(1) Survival analysis
Econometric/statistical technique that shows how the probability of an issue being resolved varies according to the time since the issue first occurred
(2) Hazard model
Econometric/statistical technique that uses a blunter measure of time than the survival analysis (eg whether advice was received within 3 months, or not), but more systematically controls for other factors that could be affecting the probability of an issue being resolved
The two approaches are complimentary

8. Survival analysis – Kaplan-Meier curves
Kaplan-Meier curves show probability of surviving an event, where in this case the event is an issue being resolved. The curve can therefore be seen as the percentage of people at various times since the issue first occurred, who have not resolved their issue
Curves show that people who received early advice are significantly more likely to have resolved their issue at each point after the issue first occurred – ie the (blue) early advice curve is significantly below the (red) ‘no early advice’ curve.
On average, a quarter (25%) of people who received early professional legal advice had resolved their problem within 3-4 months of the problem first occurring, whereas for people who did not receive early legal advice it was not until 9 months after the issue had first occurred that 25% had resolved their issue

9. Hazard model – Model structure
Dependent (left-hand side) variable = Probability of people resolving their issues
Independent (right-hand side) variables:
Whether people received early advice, or not – 1/0 variable, where 1=received advice within 3 months of issues first occurring, and 0=received advice after 3 months of issues first occurring
Controlling factors
Severity of people’s issues – On a scale 1-20, where 1-5=low severity, 6-10=fairly low severity, 11-15=medium severity, and 16-20=high severity
People’s knowledge of legal rights – Categorical variable, where categories are ‘no significant knowledge’, ‘some knowledge’, and ‘significant knowledge’
People’s age group – split into under 25-44, 45-74,75+
People’s qualification level – split into (1) degree, (2) A levels/GCSE/apprenticeship/other, (3) none
Issue type – Dummy variables for each of the 17 issue types, to control for any differences between issues
Age group was originally a coded in 7 categories: under 25, 25-34, 35-44, 45-54, 55-64, 65-74, 75+. However for the Cox Regressions some of the categories were collapsed and reduced to 3.
Note: The analysis of categorical variables, in a regression context, implies the choice of a reference category. This is used to make comparisons, for example in the early advice regressions the reference category is the first subgroup of each variable.

10. Hazard model – Cox regression results

11. Hazard model – Model results
Whether people received early advice, or not – Issues where early advice was not received, were on average 20% less likely to have been resolved at any point in time after issues first occurred Controlling factors Severity of people’s issues – High severity issues were significantly less likely to be resolved early. If an issue is ‘high severity’ then it is 38% less likely to have been resolved at any point in time than a low severity’ issue People’s knowledge of their legal rights – People with no significant knowledge of their rights, were significantly less likely to resolve their issues early. If a person had no significant knowledge of their rights, then they were 33% less likely to have resolved their problem at any point than people with significant knowledge of their rights. The importance of this variable potentially indicates the benefits that could arise from legal education programmes People’s age group – People in the age group were significant less likely to resolve their issues early, whereas people in the under 45 age group were more likely to resolve their issues early. Even after controlling for the above factors, issues that are on average more likely to be resolved early were: consumer problems, issues with a landlord, welfare benefits issues, homelessness, problems with employers The only issue that was less likely than the average to be resolved early was debt problems.

12. Main conclusions
The analysis shows that early professional advice has a significant effect on the speed of resolution of people’s issues. Controlling for other factors that affect speed of resolution, issues where early advice was not received, were on average 20% less likely to have been resolved at any point in time after issues first occurred.
Speed of resolution of issues is, not surprisingly affected by the severity of issues.
People’s knowledge of their legal rights has a significant effect on the speed of resolution. If a person had no significant knowledge of their rights, then they were 33% less likely to have resolved their problem at any point than people with significant knowledge of their rights. The importance of this variable potentially indicates the benefits that could arise from legal education programmes.

13. Possible further analysis
Repeat analysis with data from the planned 2018/19 Law Society/LSB Legal Needs Survey, to see if the above results were significantly affected by using a panel.
Repeat analysis for individual issue types, to further investigate the differences between issues, as the nature of issues is an important determinant of speed of resolution
Quantify the monetary benefits of early advice. (However, potential problems in assigning monetary values to benefits. Analysis may therefore need to just focus in certain areas eg health care benefits, or use indicators of the potential benefits)

14. Download of report/Contact details
Download of report Contact details Keith Blakemore Senior Economist Law Society Research Unit Anna Sperati Senior Statistician Ipsos MORI