Moral Entitlements and Aspiration Formation in Asymmetric Bargaining: Experimental Evidence from Germany and China

Heike Hennig-Schmidt and Gari Walkowitz
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Gari Walkowitz: Department of Corporate Development and Business Ethics, University of Cologne, Albertus-Magnus-Platz, 50923 Cologne, Germany

Games, 2017, vol. 8, issue 4, 1-25

Abstract: Using a unique experimental data set, we investigate how asymmetric legal rights shape bargainers’ aspiration levels through moral entitlements derived from equity norms and number prominence. Aspiration formation is typically hard to observe in real life. Our study involves 15 negotiations from Germany and China. Over the course of the negotiation, bargainers discuss the distribution of an amount of money by alternating offers until they consent or break off. Legal rights are randomly assigned by asymmetric outside options. We videotape and code the in-group discussions. In total, verbal data from 30 groups, 1100 pages of transcripts, and 65 h of discussions are content-analyzed. Our main finding is that strong groups derive and defend moral entitlements from equity concerns with regard to their outside options. They strive for equitable but unequal distributions (e.g., proportional split and split the difference). Moral entitlements materialize in the recorded aspiration levels and final payoffs, which exceed the equal split. By contrast, weak groups aim at equality. Over the course of the negotiation, equity tends to lose, while the prominence of round numbers gains importance. Similarities between the subject pools are found in that equity and prominence are both decisive for the formation of aspiration levels. Chinese negotiations are characterized by long periods of stagnation, only minimal concessions, and the communication of false goals. By contrast, Germans steadily reduce their goals and make concessions.

Keywords: bargaining; asymmetry; moral entitlements; aspiration levels; equity principle; prominence; fairness; video experiment; cultural comparison (search for similar items in EconPapers)
JEL-codes: C C7 C70 C71 C72 C73 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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