Abstract: The paper analyses how peer effects affect judicial decisions overdismissal disputes in Australian labour courts. Using a panel of judges and aset of over 2000 unfair dismissal decisions made over a 15 years period, wefirst test for and subsequently exploit the randomized matching of judges tocases. We also test for- and address the Priest-Klein selection effect, whichis known to potentially invalidate analysis of trial

cases. Using the spatial econometrics methodspioneered by Charles Manski we do not find evidence of endogenous peer effects,but we find significant exogenous peer effects.