The principle of pendulum arbitration is beautifully simple. Each party puts their case to the arbitrator and each states the furthest they are prepared to go to meet the other side; save that they agree that they will accept an “arbitrary” decision. The arbitrator then considers both cases and desired outcomes Then s/he chooses the one s/he arbitrarily considers the more reasonable. Only one or the other can be chosen; “splitting the difference” is not permitted.
The beauty is that the whole process puts pressure on the opposing parties to be as reasonable as they feel they can be. The more reasonable they are then the better their chances of their proposal being chosen by the arbitrator.
Before the process both parties can discuss the merits of their case. The result is that often the case is settled without finally resorting to the arbitrator.
This process gained popularity in the late 1970’s as a process for resolving industrial disputes, particularly among new enterprises entering the adversarial industrial relations environment of the time. It was written into agreements. I wonder what happened to it?