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Judicial Decision Making in Interest Arbitration

Judicial Decision Making in Interest Arbitration

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Excerpt from Judicial Decision Making in Interest Arbitration: Equity, Equality, or Anchoring?

This study uses a simulation methodology to systematically analyze the explanatory power of three alternative distributive justice norms (equity, equality, and anchoring) in describing the judgments of arbitrators in conventional arbitration. Specifically, 69 experienced arbitrators determined a wage settlement for 25 simulated disputes. Each dispute was described by the same seven criteria, which provided data relevent to the three alternative norms of arbitration. The weightings of the criteria were determined for each arbitrator by regressing wage settlement on the seven criteria. In addition, clusters of arbitrators employing similar policies were Identified. Results indicated that arbitrators are very consistent in their judgments. However, they do not subjectively know the factors that affect their judgment. In addition, the results showed that the most common arbitration norm was anchoring; to maintain the status quo by simply adjusting the present wage by the average arbitrated increase in the industry. Equity (inflation rate, financial condition of the firm, average local wage) and equality (union and management final offers) factors were far less important in the judgment policies of arbitrators. In addition to investigating these issues, the discussion section critically examined the benefits and limitations of the developed simulation procedures for understanding and improving the arbitration process.

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