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Role of Personality Style on Bargaining Outcomes

Listed author(s):
  • Bryan C. McCannon

    (West Virginia University, Department of Economics)

  • John B. Stevens

    (Saint Bonaventure University)

Purpose: The motivation for the research is to identify whether personality traits can help explain the outcomes that arise in bargaining outcomes. Design: Experiments with subjects playing the alternating-offers bargaining game are considered. Both full information and asymmetric information treatments are considered. Subjects also complete standardized Myers-Briggs Type Indicator assessments. Findings: Personality type measurements are shown to help explain the opening offers, rejections, and resulting wealth in the negotiations. It is shown that interactions between the personality dimensions are important and that the interaction between personality and information play a key role in bargaining outcomes. Research limitations/implications – The research utilizes laboratory experiments to generate data. This expands our understanding of individual level behaviour, but suffers from the limitation of not replicating realistic bargaining situations. Practical Implications: The work should serve as a guide to organizations to identify traits of effective negotiators. Social Implications: Bargaining is a central economic activity. Being able to identify the root of differences in outcomes from negotiations should be able to inform institutional design issues. Originality/Value: Little work has been done connecting the rich literature in social psychology and management on personality to economic outcomes. The research on bargaining neglects to incorporate individual-level traits into the process. This research begins to bridge this gap and informs both bargaining theory as well as emphasizes the importance of personality in application.

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File URL: http://busecon.wvu.edu/phd_economics/pdf/15-22.pdf
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Paper provided by Department of Economics, West Virginia University in its series Working Papers with number 15-22.

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Length: 30 pages
Date of creation: May 2015
Handle: RePEc:wvu:wpaper:15-22
Contact details of provider: Postal:
P.O. Box 6025, Morgantown, WV 26506-6025

Phone: (304) 293-7859
Fax: (304) 293-2233
Web page: http://business.wvu.edu/graduate-degrees/phd-economics
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  1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
  2. John C. Harsanyi & Reinhard Selten, 1988. "A General Theory of Equilibrium Selection in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582384, January.
  3. Timothy Cason & Stanley Reynolds, 2005. "Bounded rationality in laboratory bargaining with asymmetric information," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 25(3), pages 553-574, April.
  4. Schmitt, Pamela & Shupp, Robert & Swope, Kurtis & Mayer, Justin, 2008. "Pre-commitment and personality: Behavioral explanations in ultimatum games," Journal of Economic Behavior & Organization, Elsevier, vol. 66(3-4), pages 597-605, June.
  5. Romina Boarini & Jean-François Laslier & Stéphane Robin, 2009. "Interpersonal comparisons of utility in bargaining: evidence from a transcontinental ultimatum game," Theory and Decision, Springer, vol. 67(4), pages 341-373, October.
  6. Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
  7. Gunnthorsdottir, Anna & McCabe, Kevin & Smith, Vernon, 2002. "Using the Machiavellianism instrument to predict trustworthiness in a bargaining game," Journal of Economic Psychology, Elsevier, vol. 23(1), pages 49-66, February.
  8. Ben-Ner, Avner & Kong, Fanmin & Putterman, Louis, 2004. "Share and share alike? Gender-pairing, personality, and cognitive ability as determinants of giving," Journal of Economic Psychology, Elsevier, vol. 25(5), pages 581-589, October.
  9. Silvia Mendolia & Ian Walker, 2014. "The Effect Of Noncognitive Traits On Health Behaviours In Adolescence," Health Economics, John Wiley & Sons, Ltd., vol. 23(9), pages 1146-1158, September.
  10. Swope, Kurtis J. & Cadigan, John & Schmitt, Pamela M. & Shupp, Robert, 2008. "Personality preferences in laboratory economics experiments," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(3), pages 998-1009, June.
  11. Rami Zwick & Xiao-Ping Chen, 1999. "What Price Fairness? A Bargaining Study," Management Science, INFORMS, vol. 45(6), pages 804-823, June.
  12. Julia Muller & Christiane Schwieren, 2012. "What can the Big Five Personality Factors contribute to explain Small-Scale Economic Behavior?," Tinbergen Institute Discussion Papers 12-028/1, Tinbergen Institute.
  13. Kandori, Michihiro & Mailath, George J & Rob, Rafael, 1993. "Learning, Mutation, and Long Run Equilibria in Games," Econometrica, Econometric Society, vol. 61(1), pages 29-56, January.
  14. Goeree, Jacob K. & Holt, Charles A., 2000. "Asymmetric inequality aversion and noisy behavior in alternating-offer bargaining games," European Economic Review, Elsevier, vol. 44(4-6), pages 1079-1089, May.
  15. Cary Deck & Jungmin Lee & Javier Reyes & Chris Rosen, 2012. "Risk-Taking Behavior: An Experimental Analysis of Individuals and Dyads," Southern Economic Journal, Southern Economic Association, vol. 79(2), pages 277-299, October.
  16. Weg, Eythan & Rapoport, Amnon & Felsenthal, Dan S., 1990. "Two-person bargaining behavior in fixed discounting factors games with infinite horizon," Games and Economic Behavior, Elsevier, vol. 2(1), pages 76-95, March.
  17. M Perugini & J H W Tan & D J Zizzo, 2010. "Which is the More Predictable Gender? Public Good Contribution and Personality," Economic Issues Journal Articles, Economic Issues, vol. 15(1), pages 83-110, March.
  18. Boone, Christophe & De Brabander, Bert & van Witteloostuijn, Arjen, 1999. "The impact of personality on behavior in five Prisoner's Dilemma games," Journal of Economic Psychology, Elsevier, vol. 20(3), pages 343-377, June.
  19. Scharlemann, Jorn P. W. & Eckel, Catherine C. & Kacelnik, Alex & Wilson, Rick K., 2001. "The value of a smile: Game theory with a human face," Journal of Economic Psychology, Elsevier, vol. 22(5), pages 617-640, October.
  20. Bryan McCannon, 2011. "Coordination between a sophisticated and fictitious player," Journal of Economics, Springer, vol. 102(3), pages 263-273, April.
  21. Ana Paula Martins, 2007. "Ideals in sequential bargaining structures," International Journal of Social Economics, Emerald Group Publishing, vol. 34(11), pages 828-882, October.
  22. Gerrit Mueller & Erik Plug, 2006. "Estimating the Effect of Personality on Male and Female Earnings," ILR Review, Cornell University, ILR School, vol. 60(1), pages 3-22, October.
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