Abstract

An experiment on dyadic distributive negotiation is presented that analyzes the role of the market price as a credible reference point in a bargain between a human buyer and a computerized seller implementing a contingent negotiation strategy. The market price had strong effects on the initial reservation and aspiration prices, and indirectly affected the settlement price and the number of negotiation cycles, but not the agreement likelihood. An explicit frame-related manipulation, induced by the instructions, did not yield significant effects. Two simulative models of the offer formation process, grounded on the behavioral decision approach, were proposed and evaluated. The results support the view of the negotiator as a limited information-processing decision-maker, and suggest the possibility of contingent selection of reference points.

Citations

340	The Art and Science of Negotiation - Raiffa - 1982
306	The atomic components of thought - Anderson - 1998
279	The Adaptive Decision Maker - Payne, Bettman, et al. - 1993
29	The Social Psychology of Bargaining and Negotiation - Rubin, Brown - 1975
27	Cognition and rationality in negotiation - Neale, Bazerman - 1991
13	Intergrative bargaining in a competitive market - Bazerman, Magliozzi, et al. - 1985
13	Negotiation and mediation - Carnevale, Pruitt - 1992
13	Reference points, anchors, norms, and mixed feelings - Kahneman - 1992
11	The role of negotiator aspirations and settlement expectancies in bargaining outcomes - White, Neale - 1994
10	Clinical versus actuarial judgement - DAWES, FAUST, et al. - 1989
10	The Framing of Negotiations: Contextual versus Task Frames." Organizational Behavior and Human Decision Processes 39(2 - Neale, Huber, et al. - 1987
9	Negotiator cognitions: a descriptive approach to negotiators’ understanding of their opponents.” Organizational Behavior and Human Decision Processes - Carroll, Bazerman, et al. - 1988
6	The effects of anchor points and reference points on negotiation processes and outcome - Kristensen, Garling - 1997
5	Anchor points, reference points, and counteroffers in negotiations - Kristensen, Gärling - 1997
4	An information processing approach to two-party negotiations - Carroll, Payne - 1991
4	Effects of gain-loss frames in negotiation: Loss aversion, mismatching, and frame adoption. Organizational Behavior and Human Decision Processes - Dreu, Carnevale, et al. - 1994
3	Judgment accuracy and the asymmetric cost of errors in distributive bargaining. Group Decision and Negotiation - Bottom, Paese - 1999
2	Adoption of cognitive reference points in negotiations - Kristensen, Gärling - 1997
2	Determinants of buyers’ aspiration and reservation price - Kristensen, Gärling - 1997