3.1: Distributive Negotiation
Read the "Negotiation Strategies" section to learn how the distributive approach may result in missed opportunities to "expand the pie". Rather, one party may get more of the pie, and one party may get less: a win-lose outcome.
Watch this video on distributive negotiation to learn when this strategy might be appropriate and when a collaborative (or integrative) strategy may result in "expanding the pie" for both parties. Parties often use distributive bargaining (or win-lose bargaining) when they are negotiating over price. Words often associated with one or both parties in this type of bargaining include deadlock, final offer, firm, hostile, ultimatum. Inherent in distributive negotiation are the concepts of the target price, buyer's resistance point, seller's public (asking) price, seller's resistance point, and bargaining range.
This lecture describes positional bargaining and cites Fisher and Ury, who argue that positional bargaining will not produce sustainable agreements and is an inefficient means of reaching win-win solutions. Pay particular attention to the "orange" example that explains the benefits of moving beyond the position to the issues of the conflict.
Read section 2 of chapter 1. Game theory has applications for economics, operations research, and psychology, to name a few disciplines. This section gives a basic explanation of game theory, which is the study of optimal decision-making under competition when one individual's decisions affect the outcome of a situation for all other individuals involved. For a classical example, watch the video below on the Prisoner's Dilemma, which you will read about it in many discussions about game theory. How would you describe this in relation to game theory?
The Prisoner's Dilemma is a situation where you base your strategy on what you think the other party will do, and that party bases his strategy on what he thinks you will do. In game theory, the Prisoner's Dilemma illustrates how people's individual choices can lead to the worst situation possible.
View this brief video to learn the basic concept of a zero-sum game.
Read this paper, which describes how the Hobby Lobby case can be thought of as a zero-sum Religious Freedom Restoration Act (RFRA) claim.
This article describes research that seems to indicate that people who view life as a positive-sum game are happier than those who view it as a zero-sum game. While there does not seem to be any direct survey evidence relating to this question, some assessments have been made on the effects of different life goals on happiness. Personal success goals can be viewed as zero-sum, whereas altruistic goals and goals relating to family life are positive-sum goals. Research on neuroeconomics experiments in which participants play games relating to cooperation and trust tends to confirm that people who believe that others can generally be trusted would tend to have a positive-sum attitude to life.
Watch this video to learn examples of zero-sum and positive-sum games. Zero-sum games create a dynamic of competition, whereas positive-sum games can create strong attractors for cooperation. Complex scenarios exist where there are incentives for both cooperation and competition. You will learn more about how these complex and adaptive systems are affected by negative externalities later.