Thursday, July 27, 2017

When first offers fail

In negotiation, the party who makes the first offer often gets the lion’s share of the value. That can be due to the anchoring effect, or the tendency for the first offer to “anchor” the bargaining that follows in its direction, even if the offer recipient thinks the offer is out of line. Yet plenty of times, the person making the first offer fails to capture most of the value in a negotiation. Why might that be the case?
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