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Bargaining
The document discusses bargaining as a process of negotiation between two or more parties where each aims to reach an agreement beneficial to their own interests, provides an overview of different theories around bargaining approaches and factors, and offers tips for effective bargaining such as being prepared, having fun, smiling, and being willing to walk away if a reasonable price cannot be agreed upon.
Bargaining
- 1. BARGAINING Célia Junon Thomas Lochot Pierre Urier-Cattoire
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- 3. Introduction « Bargaining hasneither friends nor relations. » - Benjamin Franklin
- 4. • Bargaining • When the buyer and« negotiate In When employees: tothe seller labor relations Negotiation for a win- dispute solution and the exact with » the price win employers • Collective • nature of the employees (at A group of transaction bargaining • Representatives beneficial • Develop mutual least 3) • Come to an agreement • A bargaining • Negotiating new labor the agreement based on Unit • contract(s) such interests to Community the asstrategy interests of of dusputants Alternative pricing • Interest- • fixed pricesare :by single – Hours Represented • Interests discrimination – Wages labor union in collective Allows price based – Needs – Working conditionssome It has disappeared in bargaining bargaining – Desires – Rules in can remain for markets, but the workspace – Concerns • When an agreement is automobiles for example – Fears reached, contract is signed : Ex: « Blue-collar workers », • non-management Kübler- And…«3rd stage of the « the collectiveunderlying They are the bargaining Ross modelof»the conflict agreement reasons », etc. professors (stages of dying)
- 5. Some theories Game theory Behavioral theory • Scenario: • The personnality type • 2+ economic actors determines the bargaining • Each has a set of available process and its outcome decisions • Each has a goal or playoff Processual theory • The decision made by one • Chronological approach affect every actor’s payoff • Key features: Narrative theory – Bargaining range • Co-construction of a social – Critical risk narrative – Security point • Drives the outcome in place of the economic logic
- 6. « People, organizations,and states bargain because they want something someone else has or controls. » The Art of Bargaining, Richard Ned Lebow • People bargain to make gains or prevent losses… • …but not only: • « Do without » • « Get it elsewhere » • « Make it yourself » • « Find a substitute » • « Dispose of excess »
- 7. Bargaining allows: o More Consumer Surplus o Price Discrimination Advantages Disadvantages • Speedy • Random • Flexible • Informal • No legal standards
- 8. Adjustment of expectations/ Increasing your own options Haggling-friendly countries: Asia, the Middle East, Africa, Latin America Bargaining = a big part of everyday life, the norm for transactions Problems occuring related to: Time (ex: American VS. Chinese culture) , in India: sign posted Emotionalism (ex: Spanish VS. Asian culture) TIPS: Be prepared Have fun with it Flirt Smile What is a reasonable price? Be willing to walk away Give yourself a limit
- 9. Beijing! Travel Tips (www.beijingtraveltips.com) • Bargaining is the rule in Beijing. • DO NOT say how much you want to pay for an item. • DO throw out really low prices. • DO have an idea of what the item is worth. • BE AWARE the initial price offered by the seller is usually at least 40% over the general price acceptable. • DO keep smiling throughout.
- 10. Conclusion « While moneydoesn’t buy love, it puts you in a great bargaining position. » - Christopher Marlowe
Editor's Notes
- #5 In the Kübler-Ross Grief Cycle, the fourth stage is one of desperate bargaining. In order, the stages are: Shock, Denial, Anger, Bargaining, Depression, Testing, Acceptance.SymptomsAfter the fires of anger have been blow out, the next stage is a desperate round of bargaining, seeking ways to avoid having the bad thing happen. Bargaining is thus a vain expression of hope that the bad news is reversible.Bargaining in illness includes seeking alternative therapies and experimental drugs. In organizations, it includes offering to work for less money (or even none!), offering to do alternative work or be demoted down the hierarchy. One's loyalties, debts and dependants may be paraded as evidence of the essentiality of being saved.TreatmentWhen people are bargaining, you should not offer them any false hope. Although there may be practical things they can do which you can offer them, never offer them something that cannot be fulfilled.Sometimes the best you can do at this stage is point even more at the inevitable, even though this may well tip them into depression (which may well be a necessary move).When they are in a bargaining mood, sometimes there are things you can offer them, such as support for change or new opportunities. In these cases you may be able to strike a win-win deal, where they get an improved deal and you get collaboration or some other contribution. In a business setting, this may include finishing off some important work before they leave and receiving a special bonus for doing so._______________________________________________________________________________________________________________________________Integrative bargaining is important because it usually produces more satisfactory outcomes for the parties involved than does positional bargaining. Positional bargaining is based on fixed, opposing viewpoints (positions) and tends to result in compromise or no agreement at all. Oftentimes, compromises do not efficiently satisfy the true interests of the disputants. Instead, compromises simply split the difference between the two positions, giving each side half of what they want. Creative, integrative solutions, on the other hand, can potentially give everyone all of what they want._______________________________________________________________________________________________________________________________