Negotiation, Organizations & Markets

- August 2022
- Case
Negotiating Peace in Colombia

By: Deepak Malhotra and Cody Smith

This case follows the protracted armed conflict between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC), tracing it from its origins over 50 years ago, through the private and public negotiations that ultimately resulted in the 2016 comprehensive peace agreement. The case takes the perspective of Colombia’s President (2010-2018), Juan Manuel Santos, who must craft a strategy for ending the armed conflict, and then decide what to do after his signature achievement, a peace agreement painstakingly negotiated to end the 52-year civil war, is narrowly defeated in a national referendum. The case allows for the discussion of the barriers to deal-making in difficult, high-stakes, and complex disputes, as well as the keys to overcoming these barriers when numerous previous attempts to negotiate an agreement have failed. The case also sheds light on the leadership and strategic challenges that surface when you have to manage a diverse group of powerful stakeholders, all with a different view on what constitutes a just peace.
- August 2022
- Case
Negotiating Peace in Colombia

By: Deepak Malhotra and Cody Smith

This case follows the protracted armed conflict between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC), tracing it from its origins over 50 years ago, through the private and public negotiations that ultimately resulted in the 2016 comprehensive peace agreement. The case takes the perspective of Colombia’s President...
- Article
To Drive Efforts...Don't Tiptoe Around Your Legal Risk

By: Edward Chang and Bonnie Levine

Many Diversity, Equity, and Inclusion (DEI) initiatives are scuttled because DEI leaders and legal teams feel themselves to be at odds over questions of acceptable risk. DEI leaders see lawyers as guardians of the status quo, whereas legal experts, trained to anticipate the worst, believe they are protecting the company from legal risk. However, as the authors point out, businesses routinely choose to accept significant legal risk. In most situations they’re confronted with a risk-reward calculus that’s easy to quantify. But with DEI that’s harder, because the only thing on the balance sheet is the cost. Absent a foundation of trust and support, lawyers are skittish about signing off on initiatives, and the business is more likely to waste resources on performative exercises. And bad DEI poses a greater risk than does good DEI. When it comes to establishing a productive partnership between DEI leaders and legal counsel, the key is to collaborate early and often. In this article, the authors provide a framework to help you balance the nuances of legal risk with the need to implement effective initiatives.
- Article
To Drive Efforts...Don't Tiptoe Around Your Legal Risk

By: Edward Chang and Bonnie Levine

Many Diversity, Equity, and Inclusion (DEI) initiatives are scuttled because DEI leaders and legal teams feel themselves to be at odds over questions of acceptable risk. DEI leaders see lawyers as guardians of the status quo, whereas legal experts, trained to anticipate the worst, believe they are protecting the company from legal risk. However,...
- 2022
- Working Paper
Automating Short-Term Payroll Savings: Initial Evidence from a Large U.K. Experiment

By: Sarah Holmes Berk, John Beshears, James J. Choi and David Laibson

Automatic enrollment is often used to increase retirement plan participation. Can it be used to increase short-term savings as well? We evaluate preliminary data from an experiment at a large U.K. employer. After years of offering opt-in short-term payroll savings via a credit union, the employer introduced opt-out savings for new hires beginning in November 2021. We review initial data from the experiment. In tenure month 4, we find that scheme participation was roughly 50 percentage points higher when new hires were automatically enrolled, and balances were £68 higher.
- 2022
- Working Paper
Automating Short-Term Payroll Savings: Initial Evidence from a Large U.K. Experiment

By: Sarah Holmes Berk, John Beshears, James J. Choi and David Laibson

Automatic enrollment is often used to increase retirement plan participation. Can it be used to increase short-term savings as well? We evaluate preliminary data from an experiment at a large U.K. employer. After years of offering opt-in short-term payroll savings via a credit union, the employer introduced opt-out savings for new hires beginning...

About the Unit

The NOM Unit seeks to understand and improve the design and management of systems in which people make decisions: that is, design and management of negotiations, organizations, and markets. In addition, members of the group share an abiding interest in the micro foundations of these phenomena.

Our work is grounded in the power of strategic interaction to encourage individuals and organizations to create and sustain value (in negotiations, in organizations, and in markets). We explore these interactions through diverse approaches: Although many of us have training in economics, we also have members with backgrounds in social psychology, sociology, and law.

NOM seeks to apply rigorous scientific methods to real-world problems -- producing research and pedagogy that is compelling to both the academy and practitioners.

Recent Publications

Negotiating Peace in Colombia

By: Deepak Malhotra and Cody Smith

August 2022 |
Case |
Faculty Research

This case follows the protracted armed conflict between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC), tracing it from its origins over 50 years ago, through the private and public negotiations that ultimately resulted in the 2016 comprehensive peace agreement. The case takes the perspective of Colombia’s President (2010-2018), Juan Manuel Santos, who must craft a strategy for ending the armed conflict, and then decide what to do after his signature achievement, a peace agreement painstakingly negotiated to end the 52-year civil war, is narrowly defeated in a national referendum. The case allows for the discussion of the barriers to deal-making in difficult, high-stakes, and complex disputes, as well as the keys to overcoming these barriers when numerous previous attempts to negotiate an agreement have failed. The case also sheds light on the leadership and strategic challenges that surface when you have to manage a diverse group of powerful stakeholders, all with a different view on what constitutes a just peace.

Keywords: Conflict; Peace Process; Dispute Resolution; Protracted Conflicts; Peacemaking; Negotiation; Leadership; Conflict and Resolution; Colombia

Citation

Educators

To Drive Efforts...Don't Tiptoe Around Your Legal Risk

By: Edward Chang and Bonnie Levine

Article |
Harvard Business Review

Many Diversity, Equity, and Inclusion (DEI) initiatives are scuttled because DEI leaders and legal teams feel themselves to be at odds over questions of acceptable risk. DEI leaders see lawyers as guardians of the status quo, whereas legal experts, trained to anticipate the worst, believe they are protecting the company from legal risk. However, as the authors point out, businesses routinely choose to accept significant legal risk. In most situations they’re confronted with a risk-reward calculus that’s easy to quantify. But with DEI that’s harder, because the only thing on the balance sheet is the cost. Absent a foundation of trust and support, lawyers are skittish about signing off on initiatives, and the business is more likely to waste resources on performative exercises. And bad DEI poses a greater risk than does good DEI. When it comes to establishing a productive partnership between DEI leaders and legal counsel, the key is to collaborate early and often. In this article, the authors provide a framework to help you balance the nuances of legal risk with the need to implement effective initiatives.

Keywords: Diversity; Risk Management; Legal Liability

Citation

Automating Short-Term Payroll Savings: Initial Evidence from a Large U.K. Experiment

By: Sarah Holmes Berk, John Beshears, James J. Choi and David Laibson

2022 |
Working Paper |
Faculty Research

Automatic enrollment is often used to increase retirement plan participation. Can it be used to increase short-term savings as well? We evaluate preliminary data from an experiment at a large U.K. employer. After years of offering opt-in short-term payroll savings via a credit union, the employer introduced opt-out savings for new hires beginning in November 2021. We review initial data from the experiment. In tenure month 4, we find that scheme participation was roughly 50 percentage points higher when new hires were automatically enrolled, and balances were £68 higher.

Citation

Read Now

Strategic Complexity? Using Experiments to Understand and Overcome Obfuscation

By: Michael Luca, Ginger Zhe Jin and Daniel Martin

July 29, 2022 |
Article |
INFORMS Journal on Data Science

Citation

The Impact of the COVID-19 Pandemic on the Satisfaction of Workers in Low-Wage Jobs

By: Elizabeth R Johnson and Ashley V. Whillans

2022 |
Working Paper |
Faculty Research

How did job satisfaction change during the pandemic for workers in low-wage jobs, and how did workers’ experiences compare to those in professional jobs? Using nationally representative survey data, we show that the pandemic increased the dissatisfaction of workers in low-wage jobs and the importance of pay in determining overall job satisfaction for these workers. Before and during the pandemic, workers in low-wage jobs were significantly less satisfied than those in professional jobs. We then surveyed a group of managers about their perceptions of workers in low-wage jobs during the pandemic. Managers believed workers in low-wage jobs were less satisfied, which lead them to believe these workers would be less committed and thus deserved lower pay. We conclude by discussing our two key discoveries. First, we advance research on job satisfaction by providing evidence—that contrasts with existing findings—for differences in job satisfaction across different pay levels. Second, we contribute to the literature on stereotypes by documenting unique occupational stereotypes that perpetuate inequality. As jobs become more precarious and income inequality rises, the future of work requires greater attention to workers in low-wage job, as well as the psychological barriers to improving these jobs.

Keywords: Low-Wage Jobs; COVID-19 Pandemic; Pay; Job Satisfaction; Income Inequality; Stereotypes; Satisfaction; Compensation and Benefits; Working Conditions

Citation

Read Now

FIJI Water: Carbon Negative? (Abridged)

By: Michael W. Toffel, George Serafeim, Francesca Gino, Stephanie Van Sice and Tom Quinn

July 2022 |
Case |
Faculty Research

In the midst of increasing press scrutiny of the bottled water industry’s environmentally harmful practices, FIJI Water made a series of sustainability promises. The boldest of these was a pledge to go “carbon negative.” The company said that not only would they offset or mitigate all of their carbon emissions, but would go further, making every purchase of their hip, luxury bottles a net benefit for the environment. The unusual methodology they used to calculate their environmental benefit drew skepticism, and FIJI executives needed to evaluate how to move forward with their sustainability agenda.

Keywords: Carbon Footprint; Carbon Offsetting; Environmental Accounting; Climate Change; Environmental Sustainability; Pollution; Cross-Cultural and Cross-Border Issues; Misleading and Fraudulent Advertising; Non-Governmental Organizations; Brands and Branding; Food and Beverage Industry; Fiji; United States

Citation

Educators

Confidence, Self-Selection and Bias in the Aggregate

By: Benjamin Enke, Thomas Graeber and Ryan Oprea

2022 |
Working Paper |
Faculty Research

The influence of behavioral biases on aggregate outcomes like prices and allocations depends in part on self-selection: whether rational people opt more strongly into aggregate interactions than biased individuals. We conduct a series of betting market, auction and committee experiments using 15 classic cognitive bias tasks. We document that some cognitive errors are strongly reduced through self-selection, while others are not affected at all. A large part of this variation is explained by the quality of people's meta-cognition. In some cognitive tasks, confidence and performance are strongly positively correlated, while for others this link is absent or even negative.

Citation

The Developmental Origins and Behavioral Consequences of Attributions for Inequality

By: Antonya Marie Gonzalez, Lucia Macchia and Ashley V. Whillans

July 2022 |
Article |
Journal of Experimental Social Psychology

Attributions, or lay explanations for inequality, have been linked to inequality-relevant behavior. In adults and children, attributing inequality to an individual rather than contextual or structural causes is linked to greater support for economic inequality and less equitable giving. However, few studies have directly examined the relationship between parent and child attributions for inequality. Additionally, it remains unclear whether attributing inequality to individually controllable sources such as effort might lead children to allocate resources more inequitably than individually uncontrollable sources like innate ability. Across three studies (N = 698), we examine the developmental origins and behavioral consequences of inequality beliefs by exploring parent and children's (7–14 years old) attributions for unequal situations. In Study 1, parents, recruited through MTurk, preferred to explain inequality to their children by attributing disparities to effort rather than uncontrollable causes such as ability or luck. In Study 2, in a sample of affluent and mostly white families in Vancouver and Boston, parent attributions for inequality predicted children's attributions, such that children were more than two times as likely to attribute inequality to effort when their parents did. In Study 3, when a convenience sample of children from Washington state were brought to the laboratory and told that an inequality between two groups was due to effort, they were more likely to perpetuate the inequality by giving to the individual who already had more resources. This research documents a cycle of inequality perpetuation by demonstrating that parent attributions for inequality predict their children's attributions and that these attributions affect children's equitable giving. This work highlights the importance of examining the perceived controllability of inequality.

Keywords: Social Cognition; Inequality; Prosocial Behavior; Parent-child Transmission; Equality and Inequality; Cognition and Thinking; Attitudes; Behavior