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Are arbitrators biased in ICSID arbitration? A dynamic perspective

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  • Rao, Weijia

Abstract

Concerns over arbitrator impartiality and independence in ICSID arbitration have led to reform proposals geared towards a multilateral investment court. Due to the ad hoc nature of appointments, it has been suggested that arbitrators may strategically render decisions in biased ways with the goal of encouraging reappointments. Although criticism against arbitrator bias has attracted significant attention, so far limited empirical evidence has been provided to support such concerns. This paper introduces a dynamic perspective to examine concerns of bias arising from ad hoc appointment. I find that contrary to conventional views held by critics of investor-state arbitration, on average, arbitrators tend to decide against their reputation from prior decisions in ICSID arbitration, which implies an effort to establish a reputation for being neutral and unbiased. This finding challenges one of the premises of proposals to replace arbitration with an investment court.

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  • Rao, Weijia, 2021. "Are arbitrators biased in ICSID arbitration? A dynamic perspective," International Review of Law and Economics, Elsevier, vol. 66(C).
    • Handle: RePEc:eee:irlaec:v:66:y:2021:i:c:s0144818821000041
    DOI: 10.1016/j.irle.2021.105980
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    References listed on IDEAS

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    4. van Harten, Gus, 2007. "Investment Treaty Arbitration and Public Law," OUP Catalogue, Oxford University Press, number 9780199217892.
    5. Alma Cohen & Alon Klement & Zvika Neeman, 2015. "Judicial Decision Making: A Dynamic Reputation Approach," The Journal of Legal Studies, University of Chicago Press, vol. 44(S1), pages 133-159.
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