May 2014
Article
Judgment and Decision Making

Cynicism in Negotiation: When Communication Increases Buyers' Skepticism

By: Eyal Ert, Stephanie Creary and Max H. Bazerman

Format:Print

Abstract

The economic literature on negotiation shows that strategic concerns can be a barrier to agreement, even when the buyer values the good more than the seller. Yet behavioral research demonstrates that human interaction can overcome these strategic concerns through communication. We show that there is also a downside of this human interaction: cynicism. Across two studies we focus on a seller-buyer interaction in which the buyer has uncertain knowledge about the goods for sale, but has a positive expected payoff from saying "yes" to the available transaction. Study 1 shows that most buyers accept offers made by computers, but that acceptance rates drop significantly when offers are made by human sellers who communicate directly with buyers. Study 2 clarifies that this effect results from allowing human sellers to communicate with buyers, and shows that such communication focuses the buyers' attention on the seller's trustworthiness. The mere situation of negotiated interaction increases buyers' attention to the sellers' self-serving motives and, consequently, buyers' cynicism. Unaware of this downside of interaction, sellers actually prefer to have the opportunity to communicate with buyers.

Keywords

Trust; Information Asymmetry; Perspective Taking; Reactive Devaluation

Citation

Ert, Eyal, Stephanie Creary, and Max H. Bazerman. "Cynicism in Negotiation: When Communication Increases Buyers' Skepticism." Judgment and Decision Making 9, no. 3 (May 2014): 191–198.