Whenever conflict erupts and people search for reaching an agreement rather than resorting to aggression, negotiation takes place (Lewicki and Litterer, 1985). It is a judgement process within which counterparties mutually decide the allocation of scarce resources given non- identical preferences and utilities (e.g. Bazerman and Carroll, 1987; Neale and Northcraft, 1991; Pruitt, 1983). It is generally believed that there are two types of negotiation outcomes – economic outcomes (e.g. the terms or products of the settlement) and social psychological outcomes (e.g. the emotions or satisfaction of a negotiator). Conventional wisdom suggests that people seem to place the economic outcomes as the central point of a negotiation. However, there is a growing tendency in negotiation research that examines negotiators’ feelings, emotions and perceptions in the bargaining process. In contrast to the notion that negotiators should remain emotionless and maintain self-control (e.g. Janis and Mann, 1977; Shapiro, 2006), more negotiation researchers have begun to recognise the value of negotiators’ subjective feelings (e.g. Curhan and Brown, 2011; Thompson, 1990), and no longer viewing the study of social psychological outcomes of the negotiation as a perceptual bias or ‘supplementary analysis’ (Rubin and Brown, 1975: 297).
The most important terms of this study are two opposing concepts. As the two categories of negotiation outcomes, Economic or objective outcomes (also called objective value, or OV) are the tangible products or resources claimed by individual negotiators, or the joint payoff achieved by both parties (Oliver, Balakrishnan and Barry, 1994); Social psychological outcome, also called subjective value (SV), is defined by Curhan, Elfenbein, and Xu as “the social, perceptual and emotional consequences of a negotiation” (2006: 494).
Existing negotiation literature has been long criticised for considering negotiations as independent events, with no potential future interactions. The decontextualizing bargaining from its social, relational and historical context (e.g., Barley, 1991; Oliver, Balakrishnan and Barry, 1994) overlooks the inherent impacts of negotiators’ subjective feelings and interpersonal relationships on future negotiation incidents. The fact that the influence of SV could be significantly underrated in the negotiation research poses a unique interest and a great opportunity for this study, as well as for real-world negotiators. However, as a fairly new concept, SV appears in only 25% of published articles (Curhan and Brown, 2011; Mestdagh and Buelens, 2003). Moreover, the overall methodology adopted in these studies is quantitative surveys, with no precedents of qualitative interviewing methods. From my perspective, the attempt to use statistical and scientific measures to explain the explicitly subjective experience of negotiators leads to the inclusive or even contradictory findings on both OV and SV in the present negotiating research.
Therefore, the purpose of this study, is to explore the impacts of subjective value on both economic results and interpersonal relationships among negotiating parties. Unlike most previous research which often conducts negotiation simulations using student samples, this study relies on the expertise of negotiation practitioners each with over a decade of negotiating experience in business settings.
Following the purpose of the study, the ultimate aim of this research is to speak of the rationality of considering SV as a research topic and to answer the following research question:
How can negotiators’ subjective value influence their business negotiations?
To answer the research question adequately, four research objectives will be addressed respectively. These objectives are intended to examine:
The concept ‘Instrumental SV’ is a sub-factor of subjective value (Curhan, Elfenbein and Xu, 2006), referring to negotiators’ feeling about the instrumental outcome. The four sub-elements of SV will be explained subsequently in Chapter 2 in detail.
Starting with the review of current negotiation literature on SV and OV, Chapter 2 aims to provide a thorough background and theoretical basis for the discussion that followed next. Chapter 3 presents the methodology utilised by this research. Due to that the researcher’s interpretations are the key to this study, it is of great significance to make sense of the methods used to the reader. Therefore, Appendix H provides the researcher’s sample note for compiling literature review and informing the choice of methodology of this study. After data collection from conducting four interviews and audio transcribing, Chapter 4 presents the process of data analysis and the generation of research findings. Finally, Chapter 5 discusses the value of the research results, the limitations, practical implications and possible directions for future research.
To conclude, Chapter 1 discusses the overall purpose, objectives and structure of this study. The next chapter will have a look back at the topic of subjective value in the existing literature, and provide the empirical background for the current study.
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