Bargaining Task Research Articles

The impact of sleep restriction on interpersonal conflict resolution and the narcotic effect

Insufficient sleep is commonplace, and understanding how this affects interpersonal conflict holds implications for personal and workplace settings. We experimentally manipulated participant sleep state for a full week prior to administering a stylized bargaining task that models payoff uncertainty at impasse with a final-offer arbitration (FOA) procedure. FOA use in previous trials decreases the likelihood of voluntary settlements going forward—the narcotic effect. We also report a novel result that a significantly stronger narcotic effect is estimated for more sleepy bargaining pairs. One implication is that insufficient sleep predicts increased dependency on alternatives to voluntarily resolution of interpersonal conflict.

Negotiating in Distributive Bargaining Scenarios: The Effect of Sharing One’s Alternative

ABSTRACT This study examined negotiation outcomes following a distributive bargaining task where individuals communicated in dyads for the purchase of a hypothetical product. We used an experimental manipulation to examine the impact of sharing one’s alternative on bargainers’ final negotiated price both directly and indirectly through their partners’ one-sided negotiation tactics. After negotiating, participants in 92 dyads reported their results and provided information about their communication behaviors while bargaining. Using a dyadic mediation model, results revealed that when Buyers shared their alternatives with Sellers, they settled for higher prices compared to when Buyers did not. This outcome was the function of a direct effect of sharing on the final price, and an indirect effect through Sellers’ use of one-sided bargaining tactics.

In-regime manager: China’s strategy against nuclear India

This paper examines China’s strategy toward India’s emergence as a nuclear weapons state that reflects boundary work and delineates Beijing’s bond and boundaries of solidarity among member states in the nuclear nonproliferation regime. China’s preferred approach toward India is to maintain an asymmetrical position, to continue with a group-based resistance, and to leverage the scope of conflicts. While many previous studies indicate that China’s foreign policy toward India was an offshoot of a Cold War rivalry and its competition with the United States, with which we agree, this study explores how China’s India policy has shaped a border zone that requires a separate risk management approach. Our study has two findings: First, while Beijing perceives India’s threat as moderate, there has been an increase in New Delhi’s capability to create greater space for future bargaining tasks. Second, to keep India’s threat circumscribed, China has built a challenge-proof group arrangement that proposes a group-binding policy agenda, thus lowering the diplomatic cost for members in the current regime structure. Thus far, Beijing’s strategic action has been more cost-beneficial than India’s counterapproach. Overall, this case study indicates that a regime matters between two competing global powers.

It’s trust or risk? Chemosensory anxiety signals affect bargaining in women

It is well documented how chemosensory anxiety signals affect the perceiver’s physiology, however, much less is known about effects on overt social behavior. The aim of the present study was to investigate the effects of chemosensory anxiety signals on trust and risk behavior in men and women. Axillary sweat samples were collected from 22 men during the experience of social anxiety, and during a sport control condition. In a series of five studies, the chemosensory stimuli were presented via an olfactometer to 214 participants acting as investors in a bargaining task either in interaction with a fictitious human co-player (trust condition) or with a computer program (risk condition). It could be shown that chemosensory anxiety signals reduce trust and risk behavior in women. In men, no effects were observed. Chemosensory anxiety is discussed to be transmitted contagiously, preferentially in women.

The Impact of Sleep Restriction on Interpersonal Conflict Resolution and the Narcotic Effect

Insufficient sleep is commonplace, and understanding how this affects interpersonal conflict holds implications for personal and workplace settings. We experimentally manipulated participant sleep state for a full week prior to administering a stylized bargaining task that models payoff uncertainty at impasse with a final-offer arbitration (FOA) procedure. FOA use in previous trials decreases the likelihood of voluntary settlements going forward—the narcotic effect. We also report a novel result that a significantly stronger narcotic effect is estimated for more sleepy bargaining pairs. One implication is that insufficient sleep predicts increased dependency on alternatives to voluntarily resolution of interpersonal conflict.

Beliefs about Beliefs about Gender

Beliefs about beliefs---second-order beliefs---about the differences between populations are important to understanding differences in outcomes between those populations. To study their potential impact, we develop an incentive-compatible experimental framework for eliciting beliefs (first-order) and beliefs about beliefs (second-order) about the differences in any measurable characteristics between any two populations. We implement the procedure to study beliefs about the performance of men and women on math and abstract bargaining tasks. In the math task, 78% of participants believe that most men believe men outscore women. In contrast, 34% believe that most women believe men outscore women. Despite these differences in second-order beliefs, we observe no such difference in first-order beliefs. The pattern of results is similar in the bargaining task. These results have important labor market implications for the persistence of gender gaps.

Blocking incidental frustration during bargaining

ABSTRACTThe current study examined the effects of an intervention aimed at blocking the transfer of frustration from a previous experience (i.e. recall task) to a subsequent and unrelated task (i.e. ultimatum bargaining task). Participants who went through the intervention were more likely to accept unfair offers in the ultimatum bargaining task than those who did not go through the intervention. These results show that participants who were blocked from transferring their feelings of frustration from the recall task to the subsequent bargaining task (no-transfer condition) more likely accepted unfair offers than those who inadvertently transferred their feelings of frustration (transfer condition). The effect of conditions on accept-reject decisions in the ultimatum bargaining was mediated by reported feelings of frustration.

Culture and getting to yes : The linguistic signature of creative agreements in the United States and Egypt

SummaryWe complement the dominant rational model of negotiation found in the West with a new honor model of negotiation found in many Arabic‐speaking populations and illustrate the linguistic processes that facilitate creativity in negotiation agreements in the United States and Egypt. Community samples (N = 136) were recruited in the United States and Egypt and negotiated an integrative bargaining task, Discount Marketplace. Analyses of categories of the Linguistic Inquiry and Word Count (LIWC) and our own newly developed honor dictionary illustrate that the same language that predicts integrative agreements in the United States, namely, that which is rational and logical (cognitive mechanisms, LIWC), actually backfires and hinders agreements in Egypt. Creativity in Egypt, by contrast, reflects an honor model of negotiating with language that promotes honor gain (i.e., moral integrity) and honor protection (i.e., image and strength). Theoretical and practical implications are discussed. Copyright © 2015 John Wiley & Sons, Ltd.

Now you see it, now you don’t: The vanishing beauty premium

We design a laboratory experiment to test the extent to which the often-observed “beauty premium” – a positive relationship between attractiveness and wages – is context-specific. Using three realistic worker tasks, we find that the existence of the “beauty premium” indeed depends on the task: while relatively more attractive workers receive higher wage bids in a bargaining task, there is no such premium in either an analytical task or a data entry task. Our analysis shows that the premium in bargaining is driven by statistical discrimination based on biased beliefs about worker performance. We also find that there is substantial learning after worker-specific performance information is revealed, highlighting the importance of accounting for longer-run interactions in studies of discrimination.

Non-egalitarian allocations among preschool peers in a face-to-face bargaining task.

In face-to-face bargaining tasks human adults almost always agree on an equal split of resources. This is due to mutually recognized fairness and equality norms. Early developmental studies on sharing and equality norms found that egalitarian allocations of resources are not common before children are 5 or 6 years old. However, recent studies have shown that in some face-to face collaborative situations, or when recipients express their desires, children at much younger ages choose equal allocations. We investigated the ability of 3.5 and 5-year-olds to negotiate face-to-face, whether to collaborate to obtain an equal or an unequal distribution of rewards. We hypothesized that the face-to-face interaction and interdependency between partners would facilitate egalitarian outcomes at both ages. In the first experiment we found that 5-year-olds were more egalitarian than 3.5-year-olds, but neither of the age classes shared equally. In the second experiment, in which we increased the magnitude of the inequality, we found that children at both ages mostly agreed on the unequal distribution. These results show that communication and face-to-face interactions are not sufficient to guarantee equal allocations at 3–5 years of age. These results add to previous findings suggesting that in the context of non-collaboratively produced resources it is only after 5 years of age that children use equality norms to allocate resources.

When East meets West at the bargaining table: adaptation, behavior and outcomes in intra- and intercultural German–Chinese business negotiations

This study analyzes how negotiators from Germany and China deal with a foreign opponent compared to a compatriot. Hypotheses about negotiation behavior and behavioral adaptation are derived from differences in cooperative and competitive motivational orientation represented by the cultural values of assertiveness and humane orientation. Additionally, negotiation outcomes in this cultural setting are assessed in order to shed light on this economically very important, but currently much under researched bilateral trade relationship. To this end, 45 German, 41 Chinese, 42 German–Chinese, and 45 Chinese–German negotiation dyads had to solve a complex, integrative bargaining task through internet chats. Negotiation behavior was content-coded and subjected to logistic regression analysis. In the intracultural negotiations, German negotiators used more integrative and less distributive tactics compared to Chinese negotiators. When changing the setting from intra- to intercultural, the Chinese negotiators did not change behavior, but the German negotiators increased their level of distributive behavior. Since they did not significantly change their level of integrative behavior, we found (partial) behavioral adaptation of the German negotiators. As a result, the joint gains achieved by intercultural dyads are lower than the joint gains of German intracultural dyads, but higher than those of Chinese intracultural dyads.

Face-to-Face and Email Negotiations: A Comparison of Emotions, Perceptions and Outcomes

The purpose of this research was to conduct an exploratory study comparing email to face-to-face negotiations primarily focusing on emotions across the two negotiation environments. We used a bargaining task with a negative bargaining zone for the negotiation and pre- and post-negotiation surveys to measure motivations, emotions, and perceptions. We found that email dyads had less pro-social concerns, were less likely to reach agreement, less satisfied with the quality of the interaction during the negotiation, reported less rapport and rated future trust in their partner significantly lower than face-to-face dyads. Those negotiating face-to-face rated their own emotions during the negotiation and those of the other party significantly higher than those negotiating over email. However, accuracy in emotion perception was greater in the email dyads. Finally, our research shows that accuracy in perceiving negative emotions is a significant predictor of settlement, regardless of negotiation environment. Limitations and implications for future research directions are discussed.

When are Appearances Deceiving? The Nature of the Beauty Premium

We design a laboratory experiment to illuminate the channels through which relatively more attractive individuals receive higher wages. Specifically, we are able to distinguish taste-based discrimination from rational statistical discrimination and biased beliefs. Using three realistic worker tasks to increase the external validity of our results, we find that the “beauty premium” is highly task-specific: while relatively more attractive workers receive higher wage bids in a bargaining task, there is no such premium in either an analytical task or a data entry task. The premium in the bargaining task is driven by biased beliefs about worker performance. We find that there is substantial learning after worker-specific performance information is revealed, highlighting the importance of accounting for longer-run interactions in studies of discrimination.

Promoting integrative bargaining: mental contrasting with implementation intentions

PurposeThe present experiment aimed to test the impact of a self‐regulatory strategy of goal pursuit – called mental contrasting with implementation intentions (MCII) – on an integrative bargaining task.Design/methodology/approachParticipants were randomly assigned to dyads and negotiated over the sale of a car. Before negotiating, participants were prompted to engage in MCII, or one or the other of its two component strategies: to contrast mentally achieving success in the integrative bargaining task with the reality standing in the way of this success (MC), to form implementation intentions on how to bargain (i.e. if‐then plans) (II), or both to contrast mentally and form implementation intentions (MCII).FindingsThe strategy of mental contrasting with implementation intentions led dyads to reach the largest joint agreements, compared to dyads that only used mental contrasting or if‐then plans. Moreover, participants who mentally contrasted formed more cooperative implementation intentions than participants who did not mentally contrast, mediating the effect of condition on joint gain.Research limitations/implicationsThe findings suggest that the self‐regulatory strategy of mental contrasting with implementation intentions (MCII) leads to higher joint gain, and that this effect is mediated by mental contrasting's promotion of cooperative planning. More research should be done to understand the specific negotiation behaviors engendered by MCII, as well as its applicability to other negotiation scenarios.Originality/valueThese findings have implications for both self‐regulation and negotiation research. The result that MCII fosters integrative solutions reflects its potential to help people form cooperative plans and reach high joint‐value agreements in integrative scenarios. For negotiation research, the paper identifies an effective self‐regulatory strategy for producing high‐quality agreements.

Great expectations: neural computations underlying the use of social norms in decision-making

Social expectations play a critical role in everyday decision-making. However, their precise neuro-computational role in the decision process remains unknown. Here we adopt a decision neuroscience framework by combining methods and theories from psychology, economics and neuroscience to outline a novel, expectation-based, computational model of social preferences. Results demonstrate that this model outperforms the standard inequity-aversion model in explaining decision behavior in a social interactive bargaining task. This is supported by fMRI findings showing that the tracking of social expectation violations is processed by anterior cingulate cortex, extending previous computational conceptualizations of this region to the social domain. This study demonstrates the usefulness of this interdisciplinary approach in better characterizing the psychological processes that underlie social interactive decision-making.

Expectations and social decision-making: biasing effects of prior knowledge on Ultimatum responses

Psychological studies have long demonstrated effects of expectations on judgment, whereby the provision of information, either implicitly or explicitly, prior to an experience or decision can exert a substantial influence on the observed behavior. This study extended these expectation effects to the domain of interactive economic decision-making. Prior to playing a commonly-used bargaining task, the Ultimatum Game, participants were primed to expect offers that would be either relatively fair (a roughly equal split of an endowed amount) or unfair (an unequal split, to the participant’s disadvantage). A third group played the Game without receiving any prior information about expected offers. As predicted, these expectations had a large effect on decisions made by participants in the Ultimatum Game, with those with expectations of fairness rejecting significantly more unfair offers than those participants who expected low offers. Implications for models of fairness and equity are discussed.

The influence of asymmetric bargaining power, mutual hostages and task characteristics on the governance structure of cross-border technology alliances

Most studies of governance modes in cross border technology alliances treat contractual alliance forms and equity joint ventures as substitutes. Our sample allows us to explore when firms are likely to adopt licensing agreements without equity arrangements, in contrast to hybrid alliances that use equity joint ventures and licensing agreements together. Findings for our data provide little support for often repeated – and yet seldom tested – hypothesis that equity joint ventures may be formed to serve as a 'mutual hostage' for alliance participants, because of the fear of partner opportunism and its consequences. Rather, our findings point more strongly in favour of equity-based alliances being formed when the primary technology holder has stronger bargaining power, when patents are of importance, and when the strategic objectives of the alliance envisage future technology transfers.

Ultimatum bargaining behavior of people affected by schizophrenia

Forty-nine people suffering from schizophrenia performed an interactive bargaining task involving small monetary rewards, known in classical game theory as the Ultimatum Game. In this task, the subject, in the role of the Proposer, has to offer his or her (anonymous) counterpart, the Responder, a share of a given sum of money. If the Responder accepts the offer, then the sum is split accordingly between the two. Otherwise, if he or she decides to reject the offer, both receive nothing. The patients' strategic behavior in both roles was compared with that of healthy and clinical controls. It was hypothesized that cognitive deficits characterizing schizophrenia, together with difficulties in social judgment, would impair the patients' bargaining ability. We found that in general schizophrenic patients did not fully exploit their strategic power as Proposers. In contrast, as Responders, schizophrenic patients acted not significantly different from controls. Further investigation is needed to establish the links between cognitive and symptomatic mediators and strategic decision-making ability.

Learning and transfer in dynamic decision environments

An important aspect of learning is the ability to transfer knowledge to new contexts. However, in dynamic decision tasks, such as bargaining, firefighting, and process control, where decision makers must make repeated decisions under time pressure and outcome feedback may relate to any of a number of decisions, such transfer has proven elusive. This paper proposes a two-stage connectionist model which hypothesizes that decision makers learn to identify categories of evidence requiring similar decisions as they perform in dynamic environments. The model suggests conditions under which decision makers will be able to use this ability to help them in novel situations. These predictions are compared against those of a one-stage decision model that does not learn evidence categories, as is common in many current theories of repeated decision making. Both models' predictions are then tested against the performance of decision makers in an Internet bargaining task. Both models correctly predict aspects of decision makers' learning under different interventions. The two-stage model provides closer fits to decision maker performance in a new, related bargaining task and accounts for important features of higher-performing decision makers' learning. Although frequently omitted in recent accounts of repeated decision making, the processes of evidence category formation described by the two-stage model appear critical in understanding the extent to which decision makers learn from feedback in dynamic tasks.

Strategic Demurral in Integrative Negotiations: The Mediating Role of Contentious Behaviors and Anger

A demurral is a verbal or physical display of shock, disgust, or disbelief made immediately in response to an opening offer. This study investigated the impact of immediately demurring in response to a counterpart's opening offer in an integrative bargaining task. The results indicate that negotiators who demurred claimed significantly more value than negotiators who did not demur. Surprisingly, demurring did not affect the impasse rate or the value created in negotiations. Negotiators in receipt of a demurral, however, perceived their outcomes as less favorable than negotiators who did not receive a demurral. Furthermore, demurring appeared to negatively affect the recipient's perception of the bargaining relationship. Mediation analyses revealed that the aforementioned effects of the demurral tactic are fully mediated by the recipients' perceptions of the demurring negotiators' behaviors. Mediation analyses did not support the hypothesis that the effects of the demurral tactic would be mediated by the recipients' perception of the demurring negotiators' anger. Implications of this research for negotiation theory and practice, and directions for future research, are discussed.