Arbitration is a dispute resolution process commonly used for contract disputes. Parties involved voluntarily agree to submit their disagreements to a neutral third party, the arbitrator, who renders a binding decision. This alternative to litigation offers a faster and often more cost-effective resolution, allowing for flexibility in choosing an arbitrator with expertise in the specific industry or subject matter. Arbitration decisions are generally confidential, providing privacy to the parties involved. Overall, arbitration is favored for its efficiency and tailored approach to resolving contract disputes.