Thursday, March 10, 2016

The Information-anchoring Model of First-offers: When and Why Moving First Helps versus Hurts Negotiators

LOSCHELDER D., TROETSCHEL R., SWAAB Roderick, FRIESEN M., GALINSKY Adam D.
The Information-anchoring Model of First-offers: When and Why Moving First Helps versus Hurts Negotiators Journal of Applied Psychology (forthcoming)


Does making the first offer increase or impair a negotiator’s outcomes? Past research has found evidence supporting both claims. To reconcile these contradictory findings, we developed and tested an integrative model—the Information Anchoring Model of First Offers.The model predicts when and why making the first offer helps versus hurts.
The authors suggest that first offers have 2 effects. First, they serve as anchors that pull final settlements toward the initial first-offer value; this anchor function often produces a first-mover advantage. Second, first offers can convey information on the senders’ priorities, which makes the sender vulnerable to exploitation and increases the risk of a first-mover disadvantage. To test this model, 3 experiments manipulated the information that senders communicated in their first offer. When senders did not reveal their priorities, the first-mover advantage was replicated. However, when first offers revealed senders’ priorities explicitly, implicitly, or both, a first-mover disadvantage emerged. Negotiators’ social value orientation moderated this effect: A first-mover disadvantage occurred when senders faced proself recipients who exploited priority information, but not with prosocial recipients. Moderated mediation analyses supported the model assumptions: Proself recipients used their integrative insight to feign priorities in their low-priority issues and thereby claimed more individual value than senders. The final discussion reviews theoretical and applied implications of the Information Anchoring Model of First Offers.