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Shrewd Bargaining on the Moral Frontier: Toward a Theory of Morality in Pratice

Peter Cramton () and J. Gregory Dees

Papers of Peter Cramton from University of Maryland, Department of Economics - Peter Cramton

Abstract: From a traditional moral point of view, business practitioners often seem overly concerned about the behavior of their peers in deciding how they ought to act. We propose to account for this concern by introducing a mutual trust perspective, where moral obligations are grounded in a sense of trust that others will abide by the same rules. When grounds for trust are absent, the obligation is weakened. We illustrate this perspective by examining the widespread ambivalence with regard to deception about one's settlement preferences in negotiation. On an abstract level, such deception generally seems undesirable, though in many individual cases it is condoned, even admired as shrewd bargaining. Because of the difficulty in verifying someone's settlement preferences, it is hard to establish a basis for trusting the revelations of the other party, especially in competitive negotiations with relative strangers.

Keywords: Bargaining; Private Information; Business Ethics; Negotiations (search for similar items in EconPapers)
JEL-codes: C78 D82 M29 (search for similar items in EconPapers)
Pages: 33 pages
Date: 1991, Revised 1998-06-09
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Published in Business Ethics Quarterly, 1:2, April 1991, pages 135-167.

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Journal Article: Shrewd Bargaining on the Moral Frontier: Toward a Theory of Morality In Practice* (1991) Downloads
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