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Litigation and settlement : new evidence from labor courts in Mexico

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  • Kaplan, David S.
  • Sadka, Joyce
  • Silva-Mendez, Jorge Luis

Abstract

Using a newly assembled data set on procedures filed in Mexican labor tribunals, the authors of this paper study the determinants of final awards to workers. On average, workers recover less than 30 percent of their claim. The strongest result is that workers receive higher percentages of their claims in settlements than in trial judgments. It is also found that cases with multiple claimants against a single firm are less likely to be settled, which partially explains why workers involved in these procedures receive lower percentages of their claims. Finally, the authors find evidence that a worker who exaggerates his or her claim is less likely to settle.

Suggested Citation

  • Kaplan, David S. & Sadka, Joyce & Silva-Mendez, Jorge Luis, 2007. "Litigation and settlement : new evidence from labor courts in Mexico," Policy Research Working Paper Series 4434, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4434
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. David S. Kaplan & Joyce Sadka, 2011. "The Plaintiff's Role in Enforcing a Court Ruling: Evidence from a Labor Court in Mexico," IDB Publications (Working Papers) 38198, Inter-American Development Bank.
    2. Ronconi, Lucas & Raphael, Steven, 2024. "Measuring Effective Labor Regulation in the Less Developed World: Recent Advances and Challenges Ahead," IZA Policy Papers 210, Institute of Labor Economics (IZA).
    3. Santiago Levy & Norbert Schady, 2013. "Latin America's Social Policy Challenge: Education, Social Insurance, Redistribution," Journal of Economic Perspectives, American Economic Association, vol. 27(2), pages 193-218, Spring.
    4. Choné, Philippe & Linnemer, Laurent, 2010. "Optimal litigation strategies with observable case preparation," Games and Economic Behavior, Elsevier, vol. 70(2), pages 271-288, November.
    5. Claudine Desrieux & Romain Espinosa, 2019. "Case selection and judicial decision-making: evidence from French labor courts," European Journal of Law and Economics, Springer, vol. 47(1), pages 57-88, February.
    6. Philippe Choné & Laurent Linnemer, 2008. "Optimal Litigation Strategies with Signaling and Screening," CESifo Working Paper Series 2334, CESifo.
    7. David N Margolis, 2014. "By Choice and by Necessity: Entrepreneurship and Self-Employment in the Developing World," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 26(4), pages 419-436, September.
    8. Eric Cardella & Carl Kitchens, 2017. "The impact of award uncertainty on settlement negotiations," Experimental Economics, Springer;Economic Science Association, vol. 20(2), pages 333-367, June.
    9. Kaplan, David S. & Sadka, Joyce, 2011. "The Plaintiff's Role in Enforcing a Court Ruling: Evidence from a Labor Court in Mexico," IDB Publications (Working Papers) 3193, Inter-American Development Bank.
    10. Galiani, Sebastian & Schargrodsky, Ernesto, 2010. "Property rights for the poor: Effects of land titling," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 700-729, October.
    11. Kaplan, David S. & Sadka, Joyce, 2008. "Enforceability of labor law : evidence from a labor court in Mexico," Policy Research Working Paper Series 4483, The World Bank.
    12. Erhan Artuc & Gladys Lopez-Acevedo & Raymond Robertson & Daniel Samaan, 2019. "Exports to Jobs," World Bank Publications - Books, The World Bank Group, number 31274.
    13. Danielle Venn, 2009. "Legislation, Collective Bargaining and Enforcement: Updating the OECD Employment Protection Indicators," OECD Social, Employment and Migration Working Papers 89, OECD Publishing.
    14. Camille Signoretto & Julie Valentin, 2019. "Individual dismissals for personal and economic reasons in French firms: One or two models?," European Journal of Law and Economics, Springer, vol. 48(2), pages 241-265, October.
    15. Álvaro Bustos & Pablo Bravo-Hurtado & Antonio Aninat, 2020. "The (Other) Effects of Restricting Access to Higher Courts: The Case of Wrongful Terminations in Labor Contracts in Chile," Documentos de Trabajo 534, Instituto de Economia. Pontificia Universidad Católica de Chile..
    16. Claudine Desrieux & Romain Espinosa, 2017. "Economic analysis of French Labor Courts [Analyse économique des conseils de prud'hommes : Enjeux et Perspectives]," Post-Print halshs-02066317, HAL.

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    Keywords

    Bankruptcy and Resolution of Financial Distress; Arbitration; Information Security&Privacy; Labor Markets; Judicial System Reform;
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