Bargaining or haggling is a type of negotiation in which the buyer and seller of a good or service dispute the price which will be paid and the exact nature of the transaction that will take place, and eventually come to an agreement. Bargaining is an alternative pricing strategy to fixed prices. Optimally, if it costs the retailer nothing to engage and allow bargaining, he can divine the buyer’s willingness to spend. It allows for capturing more consumer surplus as it allows price discrimination, a process whereby a seller can charge a higher price to one buyer who is more eager (by being richer or more desperate). Haggling has largely disappeared in parts of the world where the cost to haggle exceeds the gain to retailers for most common retail items. However, for expensive goods sold to uninformed buyers such as automobiles, bargaining can remain commonplace.
The following items are tagged bargaining table.
Adapted from “Why Your Negotiating Behavior May Be Ethically Challenged—and How to Fix It,” first published in the Negotiation newsletter, March 2008.
In the late 1990s, pharmaceutical company Schering-Plough filed a patent-infringement lawsuit to prevent rival Upsher-Smith from introducing a generic version of one of Schering-Plough’s products. The two companies reached an out-of-court settlement: Upsher-Smith
Adapted from “Great Deal—But How Will It Play at the Office?” by Jeswald W. Salacuse (professor, Tufts University), first published in the Negotiation newsletter, October 2006.
To close any deal, you not only have to reach agreement with the other side but also convince your own organization of the deal’s value. In fact, you may
Adapted from “So, You Don’t Want the Other Side to Lie,” first printed in the Negotiation newsletter, June 2004.
Whether we like it or not, negotiators often lie. Researchers have found that while most of us are generally aware of this fact, few of us are adept at detecting actual lies in negotiation.
In two
Adapted from “Is Giving Advice a Waste of Time?” first published in the Negotiation newsletter, July 2007.
It’s the end of the week, and you’re trying to crank out an important report. A colleague slips into your office. “Do you have a couple of minutes?” he asks. “I need your advice on a negotiation that’s falling
Adapted from “Mediation in Transactional Negotiation,” first published in the Negotiation newsletter, July 2004.
We generally think of mediation as a dispute-resolution device. Federal mediators intervene when collective bargaining bogs down. Diplomats are sometimes called in to mediate conflicts between nations. So-called multidoor courthouses encourage litigants to mediate before incurring the costs—and risks—of going to trial.
Scott
Adapted from “Take the Long View,” by Kimberly A. Wade-Benzoni (professor, Duke University), first published in the Negotiation newsletter, April 2006.
Negotiators often overlook the long-term consequences of various issues on the table. Amid the pressures to meet short-term financial targets, it’s difficult to remember that the effects of managerial decisions may be felt years, even
Adapted from “A Worse Deal Than You Think?” First published in the Negotiation newsletter, August 2006.
Most negotiators leave the bargaining table believing they were better at pushing the other side to its limit than was actually the case, according to experimental studies by Richard P. Larrick of Duke University and George Wu of the University
Adapted from “Poise under Pressure: The Well-Balanced Negotiator,” by Michael Wheeler (professor, Harvard Business School), first published in the Negotiation newsletter, December 2006.
Too many people overlook the fact that negotiation is a demanding physical act. They cram for negotiations, pulling all-nighters in an attempt to master each and every detail—only to become irritable and fuzzy
Adapted from “Putting Negotiation Training to Work,” by Max H. Bazerman (professor, Harvard Business School), first published in the Negotiation newsletter.
Many executives read books and newsletters to improve their negotiating skills. Many also take time out of their busy work lives to attend classes and training programs, including ones focused on negotiation. Their teachers pass
Adapted from “Creating Values, Weighing Values,” by Max H. Bazerman (professor, Harvard Business School), first published in the Negotiation newsletter.
In April 2001, the FTC filed a complaint accusing pharmaceutical companies Schering-Plough and Upsher-Smith of restricting trade. Upsher-Smith had been preparing to introduce a generic pharmaceutical product that would threaten a near monopoly held by Schering-Plough.
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