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Full-Text Articles in Business
What’S The Best Way To Give Ground In A Negotiation?, Kian Siong Tey, Michael Schaerer, Nikhil Madan, Roderick Swaab
What’S The Best Way To Give Ground In A Negotiation?, Kian Siong Tey, Michael Schaerer, Nikhil Madan, Roderick Swaab
Research Collection Lee Kong Chian School Of Business
How much should you change your offer at each round of a negotiation? The stakes can be high: Give away too much and you devalue your offer; give away too little and you risk getting stuck in an impasse. The authors’ recent research shows that a rare approach to concessions — reducing the amount by which you reduce your offer each round — can yield the most value because it sends a clear signal about your final offer.
The Impact Of Concession Patterns On Negotiations: When And Why Decreasing Concessions Lead To A Distributive Disadvantage, Kian Siong Tey, Michael Schaerer, Nikhil Madan, Roderick I. Swaab
The Impact Of Concession Patterns On Negotiations: When And Why Decreasing Concessions Lead To A Distributive Disadvantage, Kian Siong Tey, Michael Schaerer, Nikhil Madan, Roderick I. Swaab
Research Collection Lee Kong Chian School Of Business
We propose that making a series of decreasing concessions (e.g., $1,500–1,210–1,180–1,170) signals that negotiators are reaching their limit and that this results in a negotiation disadvantage for offer recipients. Although we find that most negotiators do not use this strategy naturally, seven studies (N = 2,311) demonstrate that decreasing concessions causes recipients to make less ambitious counteroffers (Studies 1–5) and reach worse deals (Study 2) in distributive negotiations. We find that this disadvantage occurs because decreasing concessions shape recipients’ expectations of the subsequent offers that will be made, which results in inflated perceptions of the counterparts’ reservation price relative …