Hello, I’m Zhan Qingyun.

At the end of the previous episode we reached a mundane but unavoidable concern for lawyers: money.

Litigation is expensive, especially when a famous lawyer or major firm represents you.

How did law, so fundamental to social life, become a high-priced luxury?

Every price reflects supply and demand. On the demand side, as we discussed, companies may lose much more if they do not spend heavily on counsel and meticulous preventive legal work.

In business, professional services often distribute blame and risk. Investment banks, accounting firms, insurers, and law firms all form links in a chain that shares excessive responsibility.

An error in a contract may shift liability to another participant; each engagement provides another layer of assurance.

Major firms themselves buy expensive professional-malpractice insurance in case clients sue over mistakes causing enormous loss. Their high profits accompany substantial responsibility and risk.

Ask Americans why lawyers and lawsuits cost so much, and many answer at the personal level: think how expensive law school is. It becomes a cycle.

Whether socially vicious or virtuous, the cycle can work reasonably well for the individual.

Legal education is an investment in a career with a comparatively clear route to recouping its cost. In America, it is professionalized and even industrialized education.

Law is not normally an undergraduate major qualifying one to practice. Students attend law school after college, and it is costly. A three-year Juris Doctor can approach one hundred thousand dollars per year.

Preparing for admission tests and applications consumes time, energy, and money. Graduates then take separate state bar examinations, which not everyone passes.

Studying law is therefore a large and risky investment. Failure to enter a good school, find work, or qualify professionally may waste it.

Taking that risk naturally creates an expectation of greater future return.

Americans similarly explain expensive doctors in two ways. One is their enormous and inefficient healthcare system, including the arrangements associated with Obamacare.

The other is that physicians deserve high returns because medical school is costly and becoming a doctor requires long training and repeated selection.

My more cynical—and perhaps realistic—explanation is that lawyers are shrewd.