BUS 485 Lecture Notes - Lecture 4: Hubris, Fair Division, Zopa

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 485
• Professor: Mitra Kiamanesh

Document Summary

Neg dance = making an opening offer then reaching mutually agreeable settlement. Most negs involve win-win neg expanding the pie. = res pts overlap, overlap means that mutual agreements are better than resorting to batnas. If fail to reach agreement in this situation, outcome is suboptimal b/c negs leave $ on the table, are worse off by not reaching agreement. = indicate there is no overlap btwn parties" res pts. E. g. seller"s lowest p is but buyer"s highest p is . Negs should exercise best alts to agreement b/c negs are costly to prolong, it"s in both parties" interests to determine whether a . Bz is possible: if not, =/= waste time neg (e. g. may have time-related costs) Bargaining surplus = amt of overlap btwn parties" res pts, measure of the value that a negotiated agreement offers to bot parties over the value of not reaching settlement.