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Who Wins in Settlement Negotiations?


  • Russell Korobkin
  • Joseph Doherty


When lawsuits are resolved out of court, what determines the settlement price? This article uses a laboratory simulation and path analysis to estimate the relative importance of measurable variables in determining who wins the battle for the cooperative surplus. In the simulated negotiation conditions, seven variables explained more than half of the variation in settlement outcomes achieved by participants, with negotiators' predictions of their opponent's reservation prices the most important, followed by negotiator gender and amount of first offer. Although the specific context of this article is settlement, the insights generated are applicable to any two-party, distributive negotiation. Copyright 2009, Oxford University Press.

Suggested Citation

  • Russell Korobkin & Joseph Doherty, 2009. "Who Wins in Settlement Negotiations?," American Law and Economics Review, Oxford University Press, vol. 11(1), pages 162-208.
  • Handle: RePEc:oup:amlawe:v:11:y:2009:i:1:p:162-208

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    Cited by:

    1. Berlemann, Michael & Christmann, Robin, 2014. "Determinants of In-Court Settlements Empiricial Evidence from a German Trial Court," Working Paper 155/2014, Helmut Schmidt University, Hamburg.
    2. Morgan Westéus, 2014. "Settlement probability asymmetries in the Swedish Labour Court," European Journal of Law and Economics, Springer, vol. 38(3), pages 485-512, December.

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