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An Analytical Approach to Offer Generation in Concession-Based Negotiation Processes

Author

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  • Rudolf Vetschera

    (University of Vienna)

  • Michael Filzmoser

    (Vienna University of Technology)

  • Ronald Mitterhofer

    (Vienna University of Technology)

Abstract

We develop analytical models to assist negotiators in formulating offers in a concession-based negotiation process. Our approach is based on plausible requirements for offers formulated in terms of utility values for both the negotiator making the offer and the opponent receiving it. These requirements include value creation, reciprocity, and the fact that an offer actually leads to concessions. Trade-offs between their own and the opponent’s utilities can be formulated by negotiators and define a search path in the utility space. Solutions along this search path are then mapped back into the issue space to generate actual offers. We present and discuss several variants of optimization models to generate such offers and illustrate them with an numerical example.

Suggested Citation

  • Rudolf Vetschera & Michael Filzmoser & Ronald Mitterhofer, 2014. "An Analytical Approach to Offer Generation in Concession-Based Negotiation Processes," Group Decision and Negotiation, Springer, vol. 23(1), pages 71-99, January.
    • Handle: RePEc:spr:grdene:v:23:y:2014:i:1:d:10.1007_s10726-012-9329-z
    DOI: 10.1007/s10726-012-9329-z
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