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Models of Arbitrator Behavior: Theory and Evidence

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  • Orley Ashenfelter
  • David E. Bloom

Abstract

This paper analyzes and compares arbitrator behavior under conventional and final-offer arbitration. Simple models of arbitrator behavior are developed under each of these alternative mechanisms. These models are estimated and tested using data on the outcomes of both forms of arbitrationin New Jersey, a state in which arbitration is mandatory for unresolved pay disputes involving police officer unions and public employers. The major findings are (1) that the high proportion of union victories under final-offer arbitration were generated by a set of impartial arbitrators applying the same standards used in conventional arbitration, and (2) that union bargainers appear to be considerably more risk averse than employer bargainers, with the wage increases under final-offer arbitration having a lower mean and a lower variance than under conventional arbitration.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 1149.

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Date of creation: Jun 1983
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Publication status: published as Ashenfelter, Orley and David E. Bloom. "Models of Arbitrator Behavior: Theory and Evidence." American Economic Reveiw, Vol. 74, No. 1, (March 1984), pp. 111-124.
Handle: RePEc:nbr:nberwo:1149

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  1. William M. Landes & Richard A. Posner, 1978. "Adjudication as a Private Good," NBER Working Papers 0263, National Bureau of Economic Research, Inc.
  2. repec:fth:prinin:163 is not listed on IDEAS
  3. Orley Ashenfelter & David Bloom, 1983. "The Pitfalls in Judging Arbitrator Impartiality by Win-Loss Tallies Under Final-Offer Arbitration," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 543, Princeton University, Department of Economics, Industrial Relations Section..
  4. Henry S. Farber, 1981. "Splitting-the-difference in interest arbitration," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 35(1), pages 70-77, October.
  5. Crawford, Vincent P, 1979. "On Compulsory-Arbitration Schemes," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 87(1), pages 131-59, February.
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