The institutionalization of alternative dispute resolution (ADR) processes is the most recent development in the policy effort to reform the American civil justice system. However, the research is inconclusive and contradictory on the performance of ADR processes in institutionalized settings.
This study introduces a production model of third party dispute resolution processes to compare the performance of court annexed arbitration, judicial settlement conference, and trial processes. To explain the processes' performance, a strategic behavior model of third party dispute resolution processes identifies four strategic behaviors which influences process performance: integrative, distributive, opportunistic, and distributive. Through conceptualization of the models, several hypotheses are developed.
This study examines the hypotheses through a two phase analysis. The production model's empirical form is used to analyze a data set of 145 tort disputants to compare court annexed arbitration, judicial settlement conference, or trial processes. In phase one, data envelopment analysis is used to measure the processes' performance. In phase two, regression analysis is used to measure the significant relationship of several strategic behavior characteristics to the processes' performance measure.
This study concludes that the court annexed arbitration is the best performing process. Of the various dispute, disputant, and process characteristics identified to explain process performance, only the disputant's perception of process equity during the process is significant and positive.
The policy inference is that policy makers can reduce disputant costs while improving delay, process equity, and satisfaction through court-annexed arbitration.