The Role of Arbitration Costs and Risk Aversion in Dispute Outcomes

HENRY S. FARBER; MARGARET A. NEALE; MAX H. BAZERMAN

doi:10.1111/j.1468-232X.1990.tb00759.x

The Role of Arbitration Costs and Risk Aversion in Dispute Outcomes

HENRY S. FARBER, MARGARET A. NEALE, MAX H. BAZERMAN

Economics

Research output: Contribution to journal › Article › peer-review

8 Scopus citations

Abstract

The effects of risk aversion and of arbitration costs on bargaining outcomes are investigated using data from 171 simulated negotiations. The results are generally consistent with predictions from a simple economic bargaining model. We find strong evidence that directs costs of arbitration lead to higher rates of agreement. There is only weak evidence the risk aversion is related to the probability of agreement, but negotiated settlements seems to favor the less risk‐averse bargainer.

Original language	English (US)
Pages (from-to)	361-384
Number of pages	24
Journal	Industrial Relations: A Journal of Economy and Society
Volume	29
Issue number	3
DOIs	https://doi.org/10.1111/j.1468-232X.1990.tb00759.x
State	Published - Sep 1990

All Science Journal Classification (ASJC) codes

Industrial relations
Strategy and Management
Organizational Behavior and Human Resource Management
Management of Technology and Innovation

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10.1111/j.1468-232X.1990.tb00759.x

Cite this

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The Role of Arbitration Costs and Risk Aversion in Dispute Outcomes

Abstract

All Science Journal Classification (ASJC) codes

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