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Negotiations among Chinese and Germans - An Experimental Case Study

Author

Listed:
  • Heike Hennig-Schmidt

    (University of Bonn)

  • Gari Walkowitz

    (University of Cologne)

Abstract

This paper aims to better understand negotiation behaviour between Germans and Chinese. We study intra- and inter-cultural bargaining in negotiations with asymmetric outside options. Our analysis is based on team decisions and verbal transcripts of video-recorded within- and between-team discussions. The data show the importance of aspiration formation in combination with equity concerns. Before the negotiation starts, all teams already have formulated goals that can be traced during the subsequent negotiation. Moreover, all first offers and demands and the majority of final outcomes represent equitable shares of the amount at stake. Teams often agree upon the 'Split the Difference' allocation, which represents a feasible and justifiable compromise. Chinese typically gather as much information on their counterparts as possible, anticipate and simulate their counterparts' behavior and make harmony an issue. German teams, however, put great emphasis on fairness issues and aim at efficient outcomes by reaching an acceptable payoff within reasonable time.

Suggested Citation

  • Heike Hennig-Schmidt & Gari Walkowitz, 2015. "Negotiations among Chinese and Germans - An Experimental Case Study," Cologne Graduate School Working Paper Series 06-01, Cologne Graduate School in Management, Economics and Social Sciences.
    • Handle: RePEc:cgr:cgsser:06-01
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    File URL: http://www.cgs.uni-koeln.de/fileadmin/wiso_fak/cgs/pdf/working_paper/cgswp_06-01.pdf
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    References listed on IDEAS

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    Cited by:

    1. Ronald Bosman & Heike Hennig-Schmidt & Frans Van Winden, 2017. "Emotion at Stake—The Role of Stake Size and Emotions in a Power-to-Take Game Experiment in China with a Comparison to Europe," Games, MDPI, vol. 8(1), pages 1-22, March.
    2. Heike Hennig-Schmidt & Gari Walkowitz, 2017. "Moral Entitlements and Aspiration Formation in Asymmetric Bargaining: Experimental Evidence from Germany and China," Games, MDPI, vol. 8(4), pages 1-25, October.

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    More about this item

    Keywords

    Bargaining; Negotiation; Culture; Aspirations; Equity; Experiment;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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