Tandem anchoring: Informational and politeness effects of range offers in social exchange.

Abstract

We examined whether and why range offers (e.g., "I want $7,200 to $7,600 for my car") matter in negotiations. A selective-attention account predicts that motivated and skeptical offer-recipients focus overwhelmingly on the attractive endpoint (i.e., a buyer would hear, in effect, "I want $7,200"). In contrast, we propose a tandem anchoring account, arguing that offer-recipients are often influenced by both endpoints as they judge the offer-maker's reservation price (i.e., bottom line) as well as how polite they believe an extreme (nonaccommodating) counteroffer would be. In 5 studies, featuring scripted negotiation scenarios and live dyadic negotiations, we find that certain range offers yield improved settlement terms for offer-makers without relational costs, whereas others may yield relationship benefits without deal costs. We clarify the types of range offers that evoke these benefits and identify boundaries to their impact, including range width and extremity. In addition, our studies reveal evidence consistent with 2 proposed mechanisms, one involving an informational effect (both endpoints of range offers can be taken as signals of an offer-maker's reservation price) and another involving a politeness effect (range offers can make extreme counteroffers seem less polite). Our results have implications for models of negotiation behavior and outcomes and, more broadly, for the nature of social exchange. (PsycINFO Database Record (c) 2015 APA, all rights reserved).

How Attribution-of-Competence and Scale-Granularity Explain the Anchor Precision Effect in Negotiations and Estimations

“…On the other hand, the two mechanisms might differ in their mediating influence as a function of decision context-estimation versus negotiation. For a task that involves social interaction such as a negotiation, the social attribution-of-competence account might be relatively more influential in explaining the precision effect than the more cognitive scale-granularity account: In negotiations, information about the negotiation opponent (e.g., the opponent's competence) is essential to tailor one's strategy and plays a crucial role for the first offer's anchoring potency (Ames & Mason, 2015;Loschelder et al, 2017). Although in both contexts the competence of the anchor sender may be relevant to evaluate how strongly one can rely on the anchor value when generating an estimate, it is unique to the negotiation context that participants anticipate thoughts about the other person's reaction and an ensuing negotiation back-and-forth.…”

Interpersonal assertiveness: Inside the balancing act

“…For instance, Pillutla and Murnighan (1996) found that highly assertive (i.e., markedly ungenerous) offers in an ultimatum context were often met with anger and rejection, even when that impasse led to an economic cost for the rejector. Elsewhere, Ames and Mason (2015) counseled some negotiators to make a meaningfully more-assertive opening offer than what they had initially planned on asking for; compared with those in a control condition, these more-assertive negotiators evoked substantially higher impasse rates. Other recent research has likewise linked extreme openings to negotiation impasses, finding that acting in a highly assertive way increases the risks of ending up with no deal (Schweinsberg, Ku, Wang, & Pillutla, 2012).…”

Communicating with Warmth in Distributive Negotiations Is Surprisingly Counterproductive

“…The economic behavior of each negotiator is instantiated by the offers and concessions made in the course of the negotiation. Prior work has extensively studied the importance of these numerical aspects in affecting outcomes (e.g., Galinsky and Mussweiler 2001, Galinsky et al 2005, Mason et al 2013, Ames and Mason 2015. Noneconomic behavior includes other aspects of the interaction including body language, tone, and word choice, such as framing and use of rationales (e.g., Rubin et al 1980, Maaravi et al 2011, Bowles and Babcock 2013, Trötschel et al 2015, Lee and Ames 2017.…”