 Pay as much as you can afford: Counterpart's ability to pay and first offers in negotiationYossi Maaravi, Asya Pazy and Yoav Ganzach Judgment and Decision Making, 2011, vol. 6, issue 4, pages 275-282 Abstract: Three experiments investigated the relations between buyers' wealth or ability to pay (ATP) and sellers' first offers. Study 1 demonstrated a positive correlation between sellers' first offers and their perceptions of the buyer's ATP as well as its real economic power (indicated by the company's market value). In Study 2, sellers in a field experiment made higher offers to potential buyers of higher ATP. Study 3 examined the relations between buyer's ATP, the perception of its ability to obtain alternatives to a specific deal, and sellers' first offers. We found a positive correlation between sellers' perception of buyers' ATP, real ATP (as indicated by market value), and sellers' perception of buyers' availability of alternatives. As in Study 1, here too, the unit of analysis was the behavior of the individual participant. However, when sellers were primed to concentrate on buyers' alternatives, their first offers were negatively related to perceived buyer's alternatives. Keywords: negotiation; first offers; power; alternatives; BATNA. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:jdm:journl:v:6:y:2011:i:4:p:275-282 Access Statistics for this article Judgment and Decision Making is edited by Jonathan Baron More articles in Judgment and Decision Making from Society for Judgment and Decision Making |
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