Tension and trust in international business negotiations: American executives negotiating with Chinese executives

Kam-hon Lee, Guang Yang and John L Graham
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Kam-hon Lee: Faculty of Business Administration, The Chinese University of Hong Kong, Shatin, New Territories, Hong Kong SAR, China
Guang Yang: Faculty of Marketing, Bryant University, Smithfield, RI, USA
John L Graham: Paul Merage School of Business, University of California, Irvine, CA, USA

Journal of International Business Studies, 2006, vol. 37, issue 5, 623-641

Abstract: The purpose of the study is to shed light on the antecedents and consequences of tension felt during international business negotiations. A total of 176 American and Chinese executives participated in simulated international business (buyer–seller) negotiations. The negotiations were videotaped, and the participants completed questionnaires. Each participant was also asked to review his/her videotaped negotiation, rate the tension felt on a videotape review form, and briefly describe the antecedents of the tension felt. The data collected were then analyzed using first a structural equations approach and then a more exploratory content analysis. Both Chinese and American executives felt tension during the negotiations. For the Chinese, greater levels of tension led to an increased likelihood of agreement, but also led to lower levels of interpersonal attraction and in turn lower trust for their American counterparts. For the Americans, tension felt decreased marginally the likelihood of an agreement, did not affect interpersonal attraction, but did have a direct negative effect on trust. A series of other cultural differences are also reported. The measure of tension felt developed in the study appears to be useful methodologically, theoretically, and practically. Journal of International Business Studies (2006) 37, 623–641. doi:10.1057/palgrave.jibs.8400215

Date: 2006
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