Mediation, Arbitration And Negotiation
- Topics:
- Negotiations and Contracts
- Source:
- University of Western Ontario
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Overview: The publisher compares three common dispute resolution processes negotiation, mediation, and arbitration - in the framework of Crawford and Sobel (1982). Under negotiation, the two parties engage in (possibly arbitrarily long) face-to-face cheap talk. Under mediation, the parties communicate with a neutral third part party who makes a non-binding recommendation. Under arbitration, the two parties commit to conform to the third part party recommendation. This paper characterizes and compares the optimal mediation and arbitration procedures. Both mediators and arbitrators should optimally filter information, but mediators should also add noise to it. It was founds that unmediated negotiation performs as well as mediation if and only if the degree of conflict between the parties is low.
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Format: PDF | Size: 544KB | Date: Sep 2007 | Pages: 36
