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Litigation and settlement : new evidence from labor courts in Mexico

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Author Info
Kaplan, David S.
Sadka, Joyce
Silva-Mendez, Jorge Luis

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Abstract

Using a newly assembled data set on procedures filed in Mexican labor tribunals, the authors of this paper study the determinants of final awards to workers. On average, workers recover less than 30 percent of their claim. The strongest result is that workers receive higher percentages of their claims in settlements than in trial judgments. It is also found that cases with multiple claimants against a single firm are less likely to be settled, which partially explains why workers involved in these procedures receive lower percentages of their claims. Finally, the authors find evidence that a worker who exaggerates his or her claim is less likely to settle.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4434.

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Date of creation: 01 Dec 2007
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Handle: RePEc:wbk:wbrwps:4434

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Related research
Keywords: Bankruptcy and Resolution of Financial Distress; Arbitration; Information Security&Privacy; Labor Markets; Judicial System Reform;

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This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Barry Nalebuff, 1987. "Credible Pretrial Negotiation," RAND Journal of Economics, The RAND Corporation, vol. 18(2), pages 198-210, Summer. [Downloadable!] (restricted)
  2. Gibbons, Robert, 1988. "Learning in Equilibrium Models of Arbitration," American Economic Review, American Economic Association, vol. 78(5), pages 896-912, December. [Downloadable!] (restricted)
  3. Andrew F. Daughety & Jennifer F. Reinganum, 1999. "Hush Money," RAND Journal of Economics, The RAND Corporation, vol. 30(4), pages 661-678, Winter. [Downloadable!] (restricted)
  4. Theodore Eisenberg & Henry S. Farber, 1996. "The Litigious Plaintiff Hypothesis: Case Selection and Resolution," NBER Working Papers 5649, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Spier, Kathryn E, 1992. "The Dynamics of Pretrial Negotiation," Review of Economic Studies, Blackwell Publishing, vol. 59(1), pages 93-108, January. [Downloadable!] (restricted)
  6. Boden, Leslie I, 1992. "Dispute Resolution in Workers' Compensation," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 493-502, August. [Downloadable!] (restricted)
  7. Lucian Arye Bebchuk, 1984. "Litigation and Settlement under Imperfect Information," RAND Journal of Economics, The RAND Corporation, vol. 15(3), pages 404-415, Autumn. [Downloadable!] (restricted)
  8. Fenn, Paul & Rickman, Neil, 1999. "Delay and Settlement in Litigation," Economic Journal, Royal Economic Society, vol. 109(457), pages 476-91, July. [Downloadable!] (restricted)
  9. Robert Gibbons, 1988. "Learning in Equilibrium Models of Arbitration," Working papers 485, Massachusetts Institute of Technology (MIT), Department of Economics.
  10. Fournier, Gary M & Zuehlke, Thomas W, 1989. "Litigation and Settlement: An Empirical Approach," The Review of Economics and Statistics, MIT Press, vol. 71(2), pages 189-95, May. [Downloadable!] (restricted)
  11. I.P.L. P'ng, 1983. "Strategic Behavior in Suit, Settlement, and Trial," Bell Journal of Economics, The RAND Corporation, vol. 14(2), pages 539-550, Autumn. [Downloadable!] (restricted)
  12. Farber, Henry S & Bazerman, Max H, 1986. "The General Basis of Arbitrator Behavior: An Empirical Analysis of Conventional and Final-Offer Arbitration," Econometrica, Econometric Society, vol. 54(6), pages 1503-28, November. [Downloadable!] (restricted)
  13. Siegelman, Peter & Donohue, John J, III, 1995. "The Selection of Employment Discrimination Disputes for Litigation: Using Business Cycle Effects to Test the Priest-Klein Hypothesis," Journal of Legal Studies, University of Chicago Press, vol. 24(2), pages 427-62, June.
  14. Farber, Henry S & Bazerman, Max H, 1986. "The General Basis of Arbitrator Behavior: An Empirical Analysis of Conventional and Final-Offer Arbitration," Econometrica, Econometric Society, vol. 54(4), pages 819-44, July. [Downloadable!] (restricted)
  15. Farmer, Amy & Pecorino, Paul & Stango, Victor, 2004. "The Causes of Bargaining Failure: Evidence from Major League Baseball," Journal of Law & Economics, University of Chicago Press, vol. 47(2), pages 543-68, October.
  16. Waldfogel, Joel, 1995. "The Selection Hypothesis and the Relationship between Trial and Plaintiff Victory," Journal of Political Economy, University of Chicago Press, vol. 103(2), pages 229-60, April. [Downloadable!] (restricted)
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Kaplan, David S. & Sadka, Joyce, 2008. "Enforceability of labor law : evidence from a labor court in Mexico," Policy Research Working Paper Series 4483, The World Bank. [Downloadable!]
  2. Philippe Choné & Laurent Linnemer, 2008. "Optimal Litigation Strategies with Signaling and Screening," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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