Chinese Managers and Negotiation Strategy: An Actor-Partner Interdependence Model

Abstract

While more and more investors are negotiating with their Chinese partners, they know very little about Chinese negotiation strategy. This study aimed to examine the relationship between Chinese negotiators¡¯ use of negotiation strategy and outcomes, and further to examine the underlying psychological mechanisms of the Chinese negotiation. Using a stimulated negotiation, and analyzing the data with an actor-partner interdependence model, we found that Chinese negotiators who trusted their counterparts were more likely to use information sharing strategy, and their information sharing was more likely to be reciprocated by their partner; as a result, they better understood the relative importance of priorities to both parties, and acquired high individual and joint gains. Our results indicated that information sharing strategy was more beneficial for Chinese negotiators than substantiation and offers strategy. Chinese negotiators were not able to extract insight from information embedded in patterns of substantiation and offers, as theorized by Adair and Brett (2005), although they relied heavy on the strategy.