Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 1 of 1
Full-Text Articles in Law
The Role Of Judicial Discretion In Dispute Settlement, James Andreoni, Ray D. Madoff
The Role Of Judicial Discretion In Dispute Settlement, James Andreoni, Ray D. Madoff
Ray D. Madoff
We consider two common modes of judicial resolution: judicial discretion, where the judge or jury has broad discretion in fashioning a remedy, and winner take all where the remedy is pre-determined by the governing substantive law. We analyze these systems in light of the fact that pre-trial bargainers have been shown to have excessive confidence in their own positions. We find theoretically that winner-take-all rules magnify the effects of over-confidence and diminish the likelihood of settling relative to judicial discretion. We confirm our model with a laboratory experiment showing significantly fewer pre-trial agreements under winner-take-all. These results imply that increasing …