Innovation in the legal sector

Abstract

Introduction: this research starts from the perspective that the legal sector can be understood as an area of the service economy made up by public and private actors responsible for delivering legal services. Traditionally, legal services are referred as legal or law matters services typically provide by lawyers and/or by the judiciary, such as legal advice, claiming and defending of lawsuits, filing, contracts, conciliation, mediation, arbitration, and adjudication itself. However, mainly due technological changes and innovation in the context of the Fourth Industrial Revolution, the strategic and operational rationale of these typical actors has been changing, and other agents are somehow taking place in the legal services provision, affecting the way how legal services are produced and delivered in society. Nevertheless, literature is incipient on understanding the innovation dynamics in the sector. Purpose: analyse the innovation dynamics in the legal sector through the Sectoral Innovation System (SIS) framework. The research questions that guide this study are: "how does the process of development, use, and diffusion of innovations happen in the legal sector?", "who are the main actors involved?" and "how do they interact with each other to innovate?". Methods: this is an empirical qualitative study, specifically a case study based on interviews and documents analysis. We performed semi structured interviews with 38 actors involved in the legal sector innovation environment in two different contexts: Brazil and Germany; analysing their content based on cross-case analysis and data triangulation. Findings: our results show the main actors involved in the legal sector innovation system are the traditional public and private legal services providers, the legaltech companies, the universities, the supporting organizations, and the final consumers of legal services. There is a common rationale on how the process of development, use, and diffusion of innovations happens in the sector -despite we also show some important differences between the countries' contexts, as they have different cultural, social, and economic environments. We concluded the legal sector innovation system exists but still presents weak interactions among actors. It is a sector dealing with an emergent technology, where institutions have an outstanding role and reflect diverse tensions among actors. On one hand, the growing presence of KIE and KIBs indicates the rising of entrepreneurial experimentation, market formation, and knowledge and technology exchange among actors. On the other hand, the lack of structured policies on the field, as well the weak participation of universities and supporting organizations, imply a low level of technology/innovation legitimation and of resource mobilization. We summarize the main obstacles for the legal sector innovation system consolidation in four key issues: Legal Certainty, Responsibility, Legitimation and Funding; indicating some possible solutions to mitigate these obstacles. Contributions: this r...