Strategic Barriers To Dispute Resolution A Comparison of Bilateral and Multilate

WILLIAM GOLDMAN 10/3/2011
For Educational Use Only

!"A!EGI# $A""IE" !O DI%U!E "EOLU!ION& A'''( ) *ar+' Ne,ot' L' "e+' 1

8 Harv. Negot. L. Rev. 1
Harvard Negotiation Law Review
Spring 2003
Commentary
STRATEGIC BARRIERS TO DIS!TE RESOL!TION" A CO#ARISON O$ BILATERAL AND
#!LTILATERAL NEGOTIATIONS
Robert H. Mnookin d1
Copyright (c) 2003 Harvard Negotiation La Revie! Robert H. Mnookin
I. Introduction
"hy do negotiation# #o o$ten $ai% even hen there are po##ib%e re#o%&tion# that o&%d #erve di#p&tant# better than protracted
#tr&gg%e' (nd hy) hen re#o%&tion# are achieved) are they #o o$ten #&b*optima% $or the partie#) or achieved on%y a$ter heavy
and avoidab%e co#t#' +he#e ,&e#tion# have intrig&ed me $or a n&mber o$ year#. -evera% year# ago . rote an artic%e ca%%ed
"hy Negotiation# /ai%0 (n 12p%oration o$ 3arrier# to the Re#o%&tion o$ Con$%ict 1 and %ater) ith the he%p o$ co%%eag&e# at the
-tan$ord Center on Con$%ict Negotiation) . edited and rote the introd&ction to a vo%&me ca%%ed 3arrier# +o Con$%ict
Re#o%&tion#.2 +he#e ork# on barrier# e2p%ored $rom a variety o$ di#cip%inary per#pective# the #trategic) p#ycho%ogica% and
in#tit&tiona% barrier# that o$ten %ed to bargaining $ai%&re#.
. have taken the opport&nity o$ preparing thi# artic%e to begin to think thro&gh and compare the barrier# to the negotiated
re#o%&tion o$ con$%ict in bi%atera% and m&%ti%atera% negotiation#. /or thi# initia% $oray) . i%% primari%y $oc&# on hat . have
previo&#%y ca%%ed 4#trategic barrier#5**tho#e that ari#e $rom the e$$ort# o$ 4rationa%5 bargainer# to ma2imi6e individ&a% ret&rn#)
and may prec%&de the achievement o$ the greate#t po##ib%e 7gain# in trade7 at the %oe#t *2 co#t. .n other ord#) #trategic
barrier# are tho#e that can ca&#e rationa%) #e%$*intere#ted di#p&tant# to act in a manner that prove# to be both individ&a%%y and
co%%ective%y di#advantageo&#.
. enter the m&%tiparty or%d o$ #trategic interaction ith #ome trepidation. +o begin ith) the mo#t con#pic&o&# body o$
re%evant theoretica% #cho%ar#hip i# game theory) hich e2p%ore# i##&e# o$ #trategic interaction beteen rationa%) #e%$*intere#ted
actor#. "hi%e #&gge#tive) it i# a%#o %imiting. +he a2iomatic approach o$ game theoretica% ork on 4n*per#on game#5 i#
mathematica%%y da&nting) ha# re#tricted de#criptive poer) and make# no c%aim# at o$$ering poer$&% pre#criptive advice $or
negotiator#.3 .ndeed) a# (nato% Rapoport pointed o&t over thirty year# ago) game theoretica% ana%y#i# o$ 4n*per#on5 game#
4direct# it# main thr&#t5 to game# in 4charact
eri#tic $&nction $orm)5 hich operate at a %eve% o$ ab#traction that doe# not con#ider the #trategie# avai%ab%e to the p%ayer#.8
Nor i# there very m&ch theoretica% ork to b&i%d on o&t#ide o$ game theory. .ndeed) in 1998) "i%%iam :artman c%aimed)
7;c<&rrent%y no concept&a% ork addre##e# the va#t area o$ m&%ti%atera% negotiation# . . . . .mp%icit%y or e2p%icit%y a%%
negotiation theory addre##e# bi*%atera% negotiation#) b&t the comp%e2ity o$ m&%ti%atera% negotiation# remain# &ntreated.5=
:artman># c%aim #trike# me a# an e2aggeration. .n $act) my on thinking in the#e matter# ha# been #&b#tantia%%y promoted by
the important ork o$ Hoard Rai$$a and ?ame# -ebeni&#. +enty year# ago) in hi# #emina% book) +he (rt and -cience o$
Negotiation) Hoard Rai$$a arned) 4;t<here i# a va#t di$$erence beteen con$%ict# invo%ving to di#p&tant# and tho#e
invo%ving more than to di#p&tant#.5@ (nd even -ebeni&#) ho ha# in my vie made the mo#t important contrib&tion# to o&r
kno%edge o$ m&%tiparty negotiation) ackno%edge# that 4the c%eare#t and mo#t poer$&% advance# in theory have been ithin
or main%y in#pired by the bi*%atera% or to*party ca#e.5A
/ina%%y) hi%e m&ch o$ my on #cho%ar#hip ha# been centra%%y concerned ith negotiation# and di#p&te re#o%&tion) near%y a%%
o$ it ha# $oc&#ed on to*party ca#e#. 1ar%y in my academic career) . became intere#ted in ho the $orma% %ega% #y#tem act# a#
a backdrop $or *3 o&t*o$*co&rt negotiation#** hat . ca%%ed 7bargaining in the #hado o$ the %a.7 +he conte2t in hich .
e2p%ored thi# i##&e a# divorce) hich invo%ve# bargaining beteen to #po&#e# ho may be repre#ented by %ayer#. B -ome
2011 Thomson Reuters. No claim to original U.S. Government Works. 1
year# %ater . rote) together ith 1%eanor Maccoby) a di#ting&i#hed deve%opmenta% p#ycho%ogi#t) a book abo&t ho divorcing
parent# re#o%ved c&#tody i##&e#. Cividing the Chi%d9 i# a %ongit&dina%) empirica% #t&dy that e2p%ored ho #ome 1100
divorcing $ami%ie# re#o%ved c&#tody i##&e#. Dnce again) the $oc&# a# bi%atera% negotiation#. -imi%ar%y) my ork on barrier#
primari%y addre##ed) imp%icit%y i$ not e2p%icit%y) bi%atera% negotiation#.
My mo#t recent book) 3eyond "inning)10 a# aimed at he%ping %ayer# and their c%ient# negotiate both dea%# and di#p&te#
more e$$ective%y. "ith the e2ception o$ one chapter dea%ing ith m&%tiparty %ega% di#p&te#) thi# book primari%y ana%y6e# %ega%
negotiation# in hich to individ&a% c%ient# each hire an attorney) thereby creating a $o&r*per#on #y#tem ith %ayer# in the
midd%e. +hi# $o&r*per#on #tr&ct&re a%%o# the ana%y#i# to be 4#imp%e and c%ear)5 b&t the book ackno%edge# that 4rea%ity i#
rare%y #o kind5 and that many %ega% di#p&te# and dea%# invo%ve not to partie#) b&t #evera%**con#ider bankr&ptcy proceeding#)
environmenta% di#p&te#) or many tort# ca#e# in hich a #ing%e p%ainti$$ may #&e #evera% de$endant#) or m&%tip%e p%ainti$$# bring
#&it c%aiming that a prod&ct i# de$ective.11
+hi# artic%e i# organi6ed a# $o%%o#. Craing on my previo&# ork) Eart .. ana%y6e# #trategic barrier# in the conte2t o$ the
to*party negotiation#. . begin ith the ca#e o$ a b&yer and #e%%er #imp%y negotiating over price** di#trib&tive bargaining. .
ne2t t&rn to m&%ti*i##&e to*per#on bargaining #it&ation# here there are va%&e*creating po##ibi%itie#. Eart ... repre#ent# an
initia% $oray into the m&%tiparty or%d. . #&gge#t that the Eareto*criterion may not provide an appropriate #tandard to eva%&ate
i##&e# o$ e$$iciency in m&%tiparty bargaining. .n a to*party ca#e) any negotiated dea% pre#&mab%y better #erve# the partie#
than doe# the #tat&# ,&o. +he #ame co&%d be #aid in a m&%tiparty negotiation) b&t on%y i$ the con#ent o$ every party *4 ere
nece##ary. ( re,&irement o$ &nanimity in m&%ti%atera% negotiation) hoever) create# potentia% ho%do&t prob%em# that may po#e
#evere #trategic barrier# to re#o%&tion. +he#e prob%em# can be mitigated i$ the con#ent o$ %e## than a%% the partie# can permit
action. 3&t other prob%em# may ari#e. .$ coa%ition# o$ %e## than a%% are ab%e to change the #tat&# ,&o) thi# nece##ari%y mean#
that a party %e$t o&t o$ a coa%ition may potentia%%y be made or#e o$$.
( variety o$ proced&ra% r&%e# may permit deci#ion*making itho&t &nanimity in m&%tiparty negotiation#. MaFority voting i#
b&t one o$ many po##ib%e mechani#m# to a%%ocate deci#ion*making a&thority. +he o&tcome o$ any m&%ti%atera% negotiation can
be pro$o&nd%y a$$ected by the#e proced&ra% r&%e# and vario&# deci#ion# concerning agenda. Eart .G brie$%y e2p%ore# the
app%ication o$ an &n&#&a% proced&ra% r&%e**the 4#&$$icient con#en#&#5 #tandard**that a# emp%oyed in the m&%tiparty
4con#tit&tiona%5 negotiation# in -o&th ($rica and in Northern .re%and.
II. Strategic Barriers in Two-Party Negotiations
3eyond "inning #&gge#t# that negotiation re,&ire# the management o$ three ten#ion# inherent in negotiation0 the ten#ion
beteen creating and di#trib&ting va%&e! the ten#ion beteen empathy and a##ertivene##! and the ten#ion beteen principa%#
and agent#.12 .n to*party negotiation#) the primary #trategic barrier re%ate# to the $ir#t ten#ion beteen the de#ire $or
di#trib&tive gain**getting a bigger #%ice o$ the pie**and the opport&nity $or Foint gain#**$inding ay# to make the pie bigger.
Hnder#tanding thi# ten#ion) hich a%#o e2i#t# in m&%ti%atera% negotiation#) i# a nece##ary $o&ndation $or a%% that $o%%o#. .
begin ith the ca#e here there are no va%&e*creating opport&nitie# at a%%**a ca#e o$ p&re%y di#trib&tive bargaining beteen
to partie# negotiating over a $i2ed pie. . then move on to to*party negotiation# invo%ving m&%tip%e i##&e# here there are
va%&e*creating opport&nitie#.
A. Distributive Bargaining: Two Parties !ne Issue
D&r ana%y#i# o$ #trategic barrier# begin# ith a bi%atera% negotiation that e##entia%%y invo%ve# di#trib&ting va%&e. (##&me to
individ&a%#**3&yer and -e%%er**m&#t negotiate the price o$ a &#ed a&tomobi%e. +o #imp%i$y the matter) %et &# a##&me the#e
partie# are concerned abo&t on%y thi# dea%) and that there are no %inkage# to #imi%ar prob%em# or i##&e# o$ repetitive p%ay.
*5 Negotiation ana%y#i# #&gge#t# that each party need# to determine hi# 3(+N( (43e#t (%ternative +o a Negotiated
(greement5).13 +he 3(+N( indicate# hat that negotiator can do aay $rom the tab%e i$ no dea% i# reached. +he 3(+N(
m&#t be tran#%ated into a re#ervation va%&e**the amo&nt at hich the bargainer i# indi$$erent beteen reaching a dea% and
a%king aay to hi# 3(+N(.
.n o&r e2amp%e) . i%% a##&me that -e%%er># 3(+N( i# to #e%% hi# car to a dea%er) ho ha# o$$ered him IA)000. . i%% a##&me
that thi# i# -e%%er># re#ervation va%&e a# e%%. Let &# a##&me that 3&yer># 3(+N( i# to b&y a #omehat neer) &#ed car $rom
a dea%er ith #%ight%y %oer mi%eage $or I11)=00. 3&yer tran#%ate# thi# into a re#ervation va%&e o$ I9)000 $or the car that -e%%er
i# o$$ering.
Dn the#e $act# the :DE( (4:one D$ Eo##ib%e (greement5)**the bargaining range created by the to re#ervation va%&e#**%ie#
beteen IA)000 and I9)000. (t #take in thi# negotiation i# ho the #&rp%&# o$ I2)000 i%% be divided. 3oth 3&yer and -e%%er
are made better o$$ by any tran#action ith a price anyhere in the bargaining range. (# #&ch) any dea% ithin the :DE( i#
Eareto*#&perior to no dea% at a%%. ( #a%e $or any price beteen IA)000 and I9)000 i# Eareto*e$$icient) and other thing# being
e,&a%) 3&yer o&%d obvio&#%y pre$er to pay %e## and -e%%er o&%d pre$er to receive more. Note that thi# i# not a 6ero*#&m
game beca&#e both p%ayer# o&%d pre$er to negotiate a dea% ithin the :DE( than to have no dea% at a%%. 4;"<hen bargaining)
b&yer and #e%%er may have divergent intere#t# ith re#pect to price) b&t both may pre$er to reach #ome agreement.518
+he de#ire $or di#trib&tive gain may %ead to a bargaining $ai%&re in hich the partie# do not reach a dea%) notith#tanding the
:DE() beca&#e each i# #eeking to ma2imi6e hi# on ret&rn. +o $actor# he%p e2p%ain thi# po##ibi%ity0 in$ormation
a#ymmetrie# and #trategic behavior.
.n mo#t negotiation#) each party ha# at %ea#t #ome materia% in$ormation that the other party doe# not have. Dne potentia%
in$orma* tion a#ymmetry i# the condition or the ,&a%ity o$ the good# to be traded. +he #e%%er typica%%y kno# $ar more abo&t
the ,&a%ity o$ hat i# being #o%d than the b&yer. .t i# e%% e#tab%i#hed that in$ormation *6 a#ymmetrie# abo&t ,&a%ity) the
4%emon# prob%em)5 can a%#o %ead to non*Eareto o&tcome#.1=
+he more common a#ymmetry concern# re#ervation va%&e#. 3&yer# and #e%%er# &#&a%%y do not kno each other># 4bottom
%ine.5 3&yer) $or e2amp%e) may kno neither the amo&nt a dea%er o&%d pay $or the car) nor ho eager -e%%er i# to get rid o$
it. -e%%er may not kno 3&yer># a%ternative# or ho bad%y 3&yer ant# thi# partic&%ar car. Negotiator# rare%y revea% hone#t%y
their re#ervation va%&e. .n$ormation a#ymmetrie# o$ thi# #ort open opport&nitie# $or #trategic opport&ni#m. .ndeed) the e##ence
o$ di#trib&tive bargaining invo%ve# the attempt on the part o$ negotiator# to #hape each other># perception# o$ hat i# po##ib%e.
"hen deciding hat action to take) each p%ayer m&#t con#ider the other># po##ib%e reaction) and vice ver#a. +hi# i# the
e##ence o$ #trategic interdependence. 1ach negotiator i# con#tant%y a##e##ing hat the other #ide might event&a%%y be i%%ing
to do and ho $ar they might go.
Negotiator# emp%oy a variety o$ tactic# to in$%&ence the other #ide># perception# o$ hat i# po##ib%e**#ome mi#%eading) #ome
o&tright di#hone#t. (# a con#e,&ence) the partie# might never di#cover that there i# a :DE( beca&#e) a#piring to drive a hard
bargain) each might make e2treme o$$er# $rom hich he recede# very #%o%y. +ypica%%y) neither negotiator kno# ho $ar it
might be po##ib%e to p&#h the other #ide. (# a con#e,&ence) the drive $or di#trib&tive advantage may at time# be a barrier to a
dea% being made or a di#p&te being #ett%ed. 1ven i$ a #a%e i# con#&mmated (or the %a#&it #ett%ed)) the tran#action co#t# o$
reaching agreement might be m&ch higher than nece##ary.
"hat i$ 3&yer and -e%%er #omeho kno each other># re#ervation va%&e' .n thi# ca#e) an obvio&# $oca% point $or a dea% o&%d
be to divide the #&rp%&# in ha%$. "hi%e #p%itting the #&rp%&# may be a common re#&%t here there i# $&%% in$ormation) #trategic
opport&ni#m and the drive $or di#trib&tive gain can %ead to negotiation $ai%&re#.
1ven i$ the partie# kno (or can g&e##) each other># re#ervation price) there #ti%% can be no dea% i$ they di#agree abo&t ho the
#&rp%&# #ho&%d be divided. 1ach might attempt to #hape each other># perception# o$ ho $irm%y they i%% in#i#t on a partic&%ar
#hare o$ a knon #&rp%&#. Dne or both might try to per#&ade the other that he i# committed to a%king aay $rom a bene$icia%
dea% rather than accept %e## than the %ion># #hare o$ the #&rp%&#. H#ing a variety o$ 4commitment *7 #trategie#)5 a party can
make a 4take*it*or*%eave*it o$$er5 that o&%d give that party the %ion># #hare o$ the #&rp%&#. 1@ -e%%er might go #o $ar) $or
e2amp%e) a# to give a poer o$ attorney to an agent to #e%% on%y at a high price and then %eave ton to make that c%aim
credib%e. +o might p%ay that game and a dead%ock co&%d re#&%t0
E%ayer# in a bargaining game are in an akard po#ition. +hey ant to make the mo#t $avorab%e agreement that they can)
hi%e avoiding the ri#k o$ making no agreement at a%%! and) to certain e2tent) the#e goa%# are contradictory. .$ one party
indicate# a i%%ingne## to #ett%e $or any term#) even i$ the gain i# on%y margina%) he or #he i%% %ike%y arrive at an agreement)
b&t not a very attractive one. Dn the other hand) i$ he take# a hard po#ition and #tick# to it) he i# %ike%y to reach a $avorab%e
agreement i$ he reache# any agreement at a%%**b&t he #tand# a good chance o$ being %e$t o&t in the co%d.1A
.n #&m) hard*bargaining tactic# that may be rationa% $or #e%$*intere#ted partie# concerned ith ma2imi6ing the #i6e o$ their
on #%ice o$ the pie can #ometime# %ead to ine$$icient o&tcome#. +ho#e #&bFected to #&ch tactic# o$ten re#pond in kind) and
the net re#&%t i#) at be#t) additiona% co#t# o$ the di#p&te re#o%&tion proce## and) at or#t) $ai%&re to con#&mmate a m&t&a%%y
bene$icia% agreement.
B. An Aside on t"e Li#its o$ %a#e T"eoretica& Ana&ysis o$ Bargaining
D&r car e2amp%e genera%i6e# to a very common type o$ economic tran#action) one that economi#t# have characteri6ed a# a
bargaining game. +he b&yer o&%d pre$er to pay %e##! the #e%%er o&%d pre$er to *8 receive more! b&t both o&%d pre$er any
dea% ithin a 6one created by the their no*dea% a%ternative# to no re#o%&tion at a%%. (ccording to one very prominent game
theori#t) hoever) 7bargaining i# an e2treme%y di$$ic&%t topic beca&#e in many #etting# it r&n# right &p again#t the thing# game
theory i# not #o good at.71B .t i# he%p$&% to e2p%ain hat the#e %imitation# are.
/ir#t) beca&#e game theory i# a branch o$ mathematic#) it re,&ire# the de$inition o$ very preci#e protoco%# or r&%e# o$ the
game. .n o&r e2amp%e) and in mo#t rea% or%d bargaining #it&ation#) there are no r&%e# #et o&t in advance #peci$ying ho m&#t
make the $ir#t o$$er) hether o$$er# can be made #im&%taneo&#%y) ho many ro&nd# o$ bargaining are permitted) or hen the
negotiation end#. .ndeed) game theoretica% ana%y#i# #ho# F&#t ho #en#itive the o&tcome o$ any bargaining game i# to
vario&# protoco%#.
Con#ider the $o%%oing very #imp%e bargaining game ith the $o%%oing protoco%. Dn%y one ro&nd o$ bargaining i# permitted.
3oth partie# kno each other># re#ervation va%&e. Dne p%ayer get# to make a #ing%e take*it*or*%eave*it o$$er. .$ the other p%ayer
accept#) the tran#action i# con#&mmated at thi# price. .$ not) the game end# and each p%ayer receive# hi# no*dea% a%ternative. .$
the protoco% #peci$ie# the b&yer get# to make the #ing%e take*it*or*%eave*it o$$er) e o&%d e2pect the b&yer to capt&re a%mo#t
the entire #&rp%&# by o$$ering on%y a tiny amo&nt above IA)000. Hnder the protoco%) #ince the #e%%er o&%d be better o$$
accepting thi# price than #e%%ing to a dea%er) the b&yer o&%d get a very good dea%. Dn the other hand) i$ the protoco% provided
that the #e%%er co&%d make a take*it*or*%eave*it o$$er) the #e%%er might e#tab%i#h a price o$ near%y I9)000 and the #e%%er o&%d
e##entia%%y capt&re the entire #&rp%&#.
Negotiation over price in the rea% or%d typica%%y doe# not invo%ve #&ch #imp%e and e%%*de$ined proced&re# that are agreed
&pon in advance. .n#tead) p%ayer# can &#&a%%y make #o many po##ib%e move# and co&nter*move# that the 4game5 i# m&ch too
rich $or game theoretic techni,&e#) hich 4re,&ire c%ear and di#tinct 7r&%e# o$ the game.5>19 +hi# i# not to #ay that game
theory provide# no &#e$&% in#ight# into bargaining. Dn the contrary) non*cooperative game theory permit# mode%ing and
ana%y#i# o$ ho di$$erent #ort# o$ r&%e# o$ the game a$$ect #trategic interaction beteen rationa% actor#.
( #econd common prob%em o$ game theoretic ana%y#i# i# that there are o$ten many e,&i%ibria and no ay to choo#e among
them. *9 +hi# prob%em can a%#o be i%%&#trated ith a #imp%e one*ro&nd bargaining mode% ith one ro&nd in hich the b&yer
and #e%%er #im&%taneo&#%y name a price itho&t any prior kno%edge o$ the amo&nt #peci$ied by the other #ide. +he r&%e# o$
the game or protoco% $&rther provide that i$ the o$$er# match) the car i# #o%d at that price! i$ the b&yer># price i# higher than the
#e%%er># price) the tran#action i%% occ&r at the average o$ the to price#! and i$ the #e%%er># price i# higher than the b&yer>#
price) there i%% be no dea%.
.n thi# game) any price beteen IA)000 and I9)000 repre#ent# a Na#h 1,&i%ibri&m i$ named by both partie#. .$ the named
price# are the #ame) neither p%ayer ha# any incentive to change hi# price. +o #ee thi#) a##&me both p%ayer# named IA)2=0. .$
the #e%%er kne thi#) he o&%d %o#e the #a%e ith a higher price and receive %e## ith a %oer named price. (na%ogo&#%y) the
b&yer o&%d %o#e the tran#action ith a %oer price) and o&%d pay more ith a higher named price. .n #hort) once each
named IA)2=0) neither o&%d have any incentive to change the named amo&nt. +he parado2 i# that thi# #ame rea#oning
app%ie# to any price in the bargaining range i$ named by both p%ayer#. Jame theory 4i# o$ no he%p in #orting o&t hether any
one ;o$ the#e Na#h e,&i%ibria< i# the 7#o%&tion> and) i$ one i#) hich one i#.520 .ndeed) a# Cavid Krep# ha# empha#i6ed)
4#im&%taneo&#*o$$er bargaining i# on%y one conte2t here there i# thi# prob%em o$ too many e,&i%ibria and too %itt%e g&idance
$or choo#ing among them.521
+o e#cape the prob%em o$ m&%tip%e e,&i%ibri&m#) ?ohn Na#h approached the bargaining prob%em in an a2iomatic ay**i.e.) he
#et o&t a #erie# o$ characteri#tic# that any #o%&tion #ho&%d have. 3a#ed on the#e a2iom# he #&gge#ted an 4(rbitration -cheme5
in hich partie# o&%d agree to have an arbitrator divide the #&rp%&# in a ay that ma2imi6ed the prod&ct o$ the p%ayer>#
&ti%itie#) taking the threat point# (the 3(+N(>#) into acco&nt.22 Need%e## to #ay) it i# not c%ear ho an arbitrator co&%d e2pect
to %earn the p%ayer#> re#pective &ti%itie#) nor hy partie# to a negotiation o&%d decide to %eave their $ate to an arbitrator.
(rie% R&bin#tein bri%%iant%y mode%ed a%ternating*o$$er bargaining in a ay that prod&ced a #ing%e e,&i%ibri&m.23 Hi# game
ork# a# $o%%o#. +here are to p%ayer# and each can make one o$$er at a time. *10 E%ayer 3 ha# a choice o$ either accepting
p%ayer (># o$$er or re#ponding ith an o$$er o$ hi# on. ( key e%ement o$ thi# game i# that the #&rp%&# that the p%ayer# are
dividing dimini#he# over time and each p%ayer ha# a di#co&nt rate. +he o&tcome o$ thi# game i# that the $ir#t p%ayer on the
$ir#t ro&nd o$$er# a tiny bit more than =0L and the #econd p%ayer agree# immediate%y. +he R&bin#tein re#&%t ho%d# i$ in#tead o$
&#ing di#co&nt rate#) each party bear# tran#action co#t# each time he make# an o$$er. ( nice $eat&re o$ thi# mode% i# that i$ the
p%ayer# have the #ame time pre$erence# or the #ame tran#action co#t#) they i%% e##entia%%y divide the #&rp%&# even%y**an
o&tcome that matche# o&r int&ition. Dn the other hand) i$ there are #&b#tantia% di$$erence#) it can have very dramatic e$$ect#
on the e,&i%ibri&m**e$$ect# ith m&ch %e## int&itive appea%.28 More $&ndamenta%%y) the e2ten#ion o$ the R&bin#tein mode% to
three or more p%ayer# no %onger ha# a #ing%e) &ni,&e e,&i%ibri&m.2=
( third %imitation o$ game theoretica% ana%y#i# #ho&%d a%#o be empha#i6ed. Jame theory provide# no theory abo&t here the
r&%e# o$ the game come $rom. .n partic&%ar) a# . i%% deve%op in the ne2t #ection) beca&#e an important e%ement o$ negotiation
o$ten invo%ve# changing the game) by adding partie#) by adding i##&e#) or by #trategica%%y changing proced&re#) $orma% game
theoretica% ana%y#i# cannot he%p &# &nder#tand hy a party change# the r&%e# or p%ayer# or i##&e# hen he did. .ndeed) an
important part o$ many m&%tiparty negotiation# concern# negotiating the r&%e# and proced&re#.
(# a $ina% point) . o&%d %ike to #&gge#t that game theory i# not e#pecia%%y poer$&% either a# a de#criptive theory (predicting
ho peop%e act&a%%y behave) or a# a pre#criptive theory (#&gge#ting ho rationa% peop%e #ho&%d be#t negotiate in a or%d
here many peop%e do not behave in ay# con#i#tent ith the theory). +he#e point# are be#t i%%&#trated by con#idering the
va#t e2perimenta% %iterat&re re%ating to the 4&%timat&m game)5 the #tr&ct&re o$ hich i# akin to the #e,&entia% one*ro&nd
bargaining game de#cribed above. +he#e e2periment# #&gge#t that) economic theory notith#tanding) a party ith $&%%
in$ormation i%% o$ten re$&#e to accept a $ina% o$$er ithin the :DE( i$ the re#&%ting divi#ion o$ the #&rp%&# o$$end# hi# #en#e
o$ $airne##.
*11 .n the 7&%timat&m game7 one p%ayer i# given the right to divide a $i2ed #&m o$ money) #ay I10) and then give an
&%timat&m to the #econd p%ayer0 either accept the #hare o$$ered) in hich ca#e the I10 i# divided according to the o$$er) or
reFect the divi#ion) in hich ca#e neither p%ayer receive# anything. +hi# i# a p&re%y di#trib&tive game) here a #&rp%&# o$ I10
i# being divided into to knon #hare# #et by the $ir#t p%ayer. Jame theory #&gge#t# that a rationa% o$$eree o&%d pre$er a
pittance**#ay a penny**to receiving nothing) even i$ the o$$eror i# getting I9.99. .n other ord#) the o$$eree># re#ervation va%&e
#ho&%d be 4ep#i%on5**a #ma%% amo&nt greater than 6ero. (nd yet the evidence #&gge#t# that hen the $ir#t p%ayer divide# the
#&rp%&# in a very one*#ided ay) many o$$eree# i%% reFect the o$$er and take nothing in order to deprive the o$$eror o$ the
%ion># #hare. "here there i# $&%% in$ormation and the i##&e o$ di#trib&tion %oom# %arge) a party># #en#e o$ $airne## can %ead to
hat economi#t# o&%d ca%% Eareto*ine$$icient o&tcome#. .n #hort) a# a de#criptive matter) the game theoretica% mode% o$ thi#
#imp%e game doe# not capt&re the behavior o$ many individ&a%#.2@
.$ thi# i# #o) there are important imp%ication# $or pre#criptive theory) or hat Hoard Rai$$a #&gge#t# i# the appropriate
4de#criptive*pre#criptive5 #tance o$ #omeone giving advice to rea% or%d negotiator#. Rai$$a #&gge#t# that a good pre#criptive
theory #ho&%d be ba#ed on ho one be%ieve# the negotiating co&nterpart act&a%%y behave#. +he be#t pre#criptive advice to
#omeone ho get# to divide the pie in the &%timat&m game i# that he i%% probab%y ma2imi6e hi# ret&rn by dividing the I10 to
o$$er the other #ide #omething in the I8 range**$ar more than a penny. "hi%e #ome may t&rn don anything other than an
even #p%it) mo#t i%% accept an &neven #p%it #o %ong a# it# not too e2treme.2A
'. Two Parties Severa& Issues: T"e Tension Between 'reating and Distributing (a&ue
Mo#t negotiation# invo%ve more than dividing a $i2ed pie**they a%#o o$$er opport&nitie# $or creating va%&e and thereby
e2panding the pie. "hat do . mean by creating va%&e' . think it i# be#t de$ined in term# o$ Eareto*e$$iciency. (n o&tcome i#
#aid to be Eareto*e$$icient or Eareto*optima% i$ one party can be made better o$$ on%y by making *12 the other party or#e o$$.
1conomic# teache# that there i# a Eareto $rontier con#i#ting o$ vario&# Eareto*optima% o&tcome# that have di$$erent
di#trib&tive con#e,&ence# $or the partie#.2B
3y de$inition) henever there i# a negotiated agreement in a to*party negotiation both partie# m&#t be%ieve that a negotiated
o&tcome %eave# them at %ea#t a# e%% o$$ a# they o&%d have been i$ there ere no agreement. +here$ore) in a $i2ed) po#itive
#&m game) any re#o%&tion i# Eareto*e$$icient in compari#on to no dea% at a%%. Dn the other hand) in negotiation# here it i#
po##ib%e to create va%&e) partie# may reach negotiated o&tcome# that are not Eareto*e$$icient i$ there i# #ome other negotiated
o&tcome avai%ab%e that might make one party better o$$ itho&t harming the other. +hi# notion o$ creating va%&e b&i%d# on a
%ong*e#tab%i#hed tradition that negotiation %iterat&re re$er# to a# the 7integrative7 po##ibi%itie# pre#ent in #ome negotiation#.29
3e$ore de#cribing hy #trategic interaction may prevent negotiator# $rom reaching re#o%&tion# that are Eareto*e$$icient) one
#ho&%d $ir#t &nder#tand the #o&rce# o$ va%&e and their economic &nderpinning#. .n my vie) there are $o&r #o&rce# o$ va%&e
thro&gh negotiation0 di$$erence# beteen the partie#! non*competitive #imi%aritie#! economie# o$ #ca%e and #cope! and
opport&nitie# $or red&cing tran#action co#t# and dampening economic opport&ni#m.
+he notion that di$$erence# can create va%&e i# co&nterint&itive to many negotiator#) ho be%ieve they can reach agreement
on%y by $inding common gro&nd. 3&t the tr&th i# that di$$erence# are o$ten more &#e$&% than #imi%aritie# in he%ping partie#
reach a dea%. Ci$$erence# #et the #tage $or po##ib%e gain# thro&gh trade) and it i# thro&gh trade that va%&e i# mo#t common%y
created. +here are $ive type# o$ di$$erence# that are a%% potentia% #o&rce# o$ va%&e creation0 di$$erent re#o&rce#! di$$erent
re%ative va%&ation#! di$$erent $oreca#t#! di$$erent ri#k pre$erence#! and di$$erent time pre$erence#. +hro&gh the negotiation
proce##) to the e2tent that partie# di#cover that #&ch di$$erence# e2i#t) they can #tr&ct&re tran#action# that create va%&e by
trading on hat amo&nt# to di$$erence# in re%ative va%&ation.
*13 ( #econd #o&rce o$ va%&e i# non*competitive #imi%aritie#. .n the#e in#tance#) one per#on># gain doe# not mean the other
per#on># %o##. /or e2amp%e) negotiator# o$ten have a #hared intere#t in a prod&ctive) cordia% orking re%ation#hip. 3oth gain to
the e2tent that they can improve their re%ation#hip. Likei#e) parent# #hare an intere#t in the e%%*being o$ their chi%dren. .$ a
chi%d $%o&ri#he#) both parent# derive #ati#$action. +h&#) even $or divorcing parent#) arrangement# that bene$it a chi%d create
Foint gain# $or both ad&%t#.
( third #o&rce o$ va%&e re%ate# to economie# o$ #ca%e and #cope. +o $irm# that each have a #ma%% p%ant may be ab%e to red&ce
the &nit co#t o$ prod&ction by having a Foint vent&re that b&i%d# one %arge prod&ction $aci%ity. Creating or pre#erving #ca%e
economie# i# a rich #o&rce o$ va%&e creation. -imi%ar%y) economie# o$ #cope can a%#o create va%&e. +he#e ari#e hen more than
one good or #ervice can be prod&ced &#ing the #ame ba#ic re#o&rce#) th&# red&cing the co#t# o$ each.
Negotiator# can a%#o create va%&e by red&cing the tran#action co#t# o$ reaching an agreement and by dampening #trategic
opport&ni#m. +hi# can occ&r in #evera% ay#0 by making the proce## o$ negotiation %e## time*con#&ming and co#t%y! by
red&cing the ri#k# that the partie# i%% deceive each other! and by better a%igning $&t&re incentive#.
"hat) then) i# the ten#ion beteen creating and di#trib&ting va%&e in a negotiation' .t i# a ten#ion that) i$ managed bad%y) i%%
%ead to o&tcome# that $ai% to $&%%y e2p%oit the va%&e creating po##ibi%itie#. .n$ormation drive# thi# ten#ion. "itho&t #haring
in$ormation) negotiator# $ind it di$$ic&%t to identi$y trade# that might create va%&e and potentia%%y make both partie# better o$$.
Hnreciprocated openne##) hoever) can be e2p%oited. Ci#c%o#ing one># pre$erence#) re#o&rce#) intere#t#) and a%ternative# can
he%p to create va%&e) b&t can po#e a grave ri#k ith re#pect to di#trib&tive i##&e#. Negotiator# are con#tant%y ca&ght beteen
the#e competing #trategic demand#.
.n the end) an individ&a% negotiator i# typica%%y concerned $ir#t ith the #i6e o$ her #%ice and on%y #econdari%y ith the #i6e o$
the pie a# a ho%e. .ndeed) a negotiator ho can ea#i%y c%aim a %arge #hare o$ a #ma%% pie may ind &p ith more to eat than
one ho bake# a m&ch bigger pie b&t end# &p ith on%y a #%iver. ( #ki%%$&% negotiator move# nimb%y beteen imaginative
#trategie# to en%arge the pie and con#ervative #trategie# to #ec&re an amp%e #%ice no matter hat #i6e the $ina% pie t&rn# o&t to
be. Ci$$ic&%tie# ari#e) hoever) beca&#e many negotiator# do not manage thi# ten#ion e%% and) a# a con#e,&ence o$ *14
$oc&#ing primari%y on the di#trib&tive dimen#ion o$ bargaining) $ai% to #ei6e va%&e*creating opport&nitie#.
.n #hort) acc&rate in$ormation abo&t each negotiator># goa%#) prioritie#) pre$erence#) re#o&rce#) and opport&nitie# i# e##entia%
to reach agreement# that o$$er optima% 7gain $rom trade7**agreement# tai%ored to take $&%% advantage o$ the #o&rce# o$ va%&e
o&t%ined above. (t the #ame time) hoever) partie# have a c%ear incentive to concea% their intere#t# and prioritie#) or even
mi#%ead the other #ide abo&t them. 3y $eigning attachment to hatever re#o&rce# they are ready to give &p in trade and
$eigning re%ative indi$$erence to hatever re#o&rce# they #eek to gain hi%e concea%ing opport&nitie# $or &ti%i6ation o$ the#e
re#o&rce#) each party #eek# to in the be#t po##ib%e term# o$ trade $or it#e%$. .n other ord#) tota% $rankne## and 7$&%%
di#c%o#&re7**or #imp%y greater $rankne## and $&%%er di#c%o#&re than practiced by the other #ide o$ the negotiation**%eave one
#ide v&%nerab%e in the di#trib&tive a#pect o$ bargaining. (ccording%y) the #harp bargainer i# tempted) and may rationa%%y deem
it advantageo&#) to practice #ecrecy and deception. Dnce again) hoever) the#e tactic# can %ead to &nnece##ary dead%ock# and
co#t%y de%ay# or) more $&ndamenta%%y) $ai%&re# to di#cover the mo#t e$$icient trade# or o&tcome#.30
) ) ) )
+hi# #hort #&mmary #&gge#t# the &nder%ying rea#on# that #trategic interaction**the #e%$*con#cio&# rationa% behavior o$
individ&a% negotiator#** may act a# a barrier to Eareto*e$$icient o&tcome#. .n #imp%e negotiation# that on%y imp%icate
di#trib&tive i##&e#) the re#&%t may be no agreement &nder circ&m#tance# here both partie# co&%d be made better o$$ by one or
more po##ib%e agreement#. "here a negotiation invo%ve# #evera% dimen#ion#) there are o$ten integrative po##ibi%itie#**
opport&nitie# to make the pie bigger. Here) the prob%em can be to*$o%d. .n #ome in#tance#) the $oc&# on di#trib&tive gain
may re#&%t in no dea% or re#o%&tion at a%%. More common%y) it may %ead to a negotiated o&tcome that i# not Eareto*optima%.
III. *u&ti+arty Negotiations
My ana%y#i# o$ bi%atera% negotiation# e2p%ain# hy a negotiator># p&r#&it o$ di#trib&tive gain can o$ten %ead to negotiation
$ai%&re#. 1ven tho&gh there are po##ib%e agreement# that o&%d better #erve the partie#) agreement may not be reached at a%%)
or even i$ re#o%&tion *15 i# achieved) may not #ati#$y the economi#t># Eareto*criterion o$ e$$iciency. +he#e #ame #trategic
prob%em#**and the &nder%ying ten#ion beteen creating and c%aiming va%&e**e2i#t in m&%tiparty negotiation# a# e%%. 3&t in
thi# #ection) . o&%d %ike to e2p%ore #evera% additiona% #trategic comp%ication# that may act a# barrier# in the m&%tiparty
conte2t a%one.
+he $ir#t prob%em concern# the meaning o$ creating va%&e and e$$iciency in the m&%tiparty conte2t. Like other negotiation
ana%y#t#) in bi%atera% negotiation# . de$ine creating va%&e in term# o$ Eareto*e$$iciency. +hi# mea#&re doe# not re,&ire inter*
per#ona% &ti%ity compari#on#. .t #imp%y #&gge#t# that e$$iciency i# improved henever there i# an a%ternative re#o%&tion that
either make# both partie# better o$$ or make# one party better o$$ hen the other party i# no or#e o$$. (n important $eat&re o$
bi%atera% negotiation i# that henever the partie# have agreed to an o&tcome) that o&tcome can be pre#&med to better #erve the
intere#t# o$ each party than the #tat&# ,&o**otheri#e there o&%d have been no agreement.
Mea#&ring va%&e i# m&ch %e## #traight$orard in a m&%tiparty conte2t. Earado2ica%%y) the re,&irement o$ Eareto*e$$iciency
may be very ine$$icient. +he Eareto*criterion re,&ire# that every party to a negotiation have veto poer over the dea%. .$ there
are ten partie# to a negotiation) the on%y ay e can kno that a negotiated agreement i# Eareto*#&perior to the #tat&# ,&o i#
i$ a%% ten partie# agree to make the dea%. .n other ord#) Eareto*e$$iciency in a m&%tiparty negotiation re,&ire# &nanimity.
Hn$ort&nate%y) a &nanimity r&%e create# the #trategic ri#k o$ ho%do&t prob%em#. (##&me) $or the moment) that the :DE( in a
m&%tiparty conte2t inc%&de# many po##ib%e dea%# ith di$$erent di#trib&tive imp%ication#) a%% o$ hich make a%% ten negotiator#
better o$$ than the #tat&# ,&o. "ith a &nanimity r&%e) the di#trib&tive a#pect# o$ m&%tiparty bargaining can become e2treme%y
di$$ic&%t and time con#&ming to manage. "henever nine o&t o$ ten negotiator# have agreed to a partic&%ar dea%) the tenth
per#on may credib%y threaten to veto that dea% beca&#e he ant# a dea% that give# him a %arger #hare o$ the pie. Dbvio&#%y
more than one negotiator can p%ay thi# game) and a# a con#e,&ence) the tran#action co#t# o$ attempting to achieve &nanimo&#
agreement can be very high and negotiation# can break don.
( $e year# back) . #a an e2amp%e o$ thi#. ( Cambridge) Ma##ach&#ett# neighborhood a# given the opport&nity to have it#
e%ectrica% ire# p&t &ndergro&nd. +he city o&%d provide a partia% #&b#idy) b&t the ten neighbor# a%% had to con#ent to an
a%%ocation o$ *16 the remaining co#t# $or in#ta%%ing the ne main ire. "hatever the a%%ocation) each neighbor o&%d a%#o
need to pay hi# on hook*&p co#t# $or bringing the poer $rom the ne &ndergro&nd ire to hi# ho&#e. Mo#t neighbor#
,&ick%y agreed to a%%ocate the co#t o$ the main ire ba#ed on $rontage $eet o$ each %ot. 3&t one neighbor) 4Mr. ?one#)5 ho#e
ho&#e a# #et $arther back $rom the #treet) obFected. He arg&ed that #ince hi# connection co#t to a ne &ndergro&nd ire
o&%d be higher) he #ho&%d pay a #ma%%er #hare o$ the Foint co#t#. +o other neighbor# #a ?one#> #&gge#tion a# #trategic**a#
ho%ding o&t to get more o$ the #&rp%&#** and a# a con#e,&ence) no dea% co&%d be made at a%%0 the e%ectrica% ire# ere not
p%aced &ndergro&nd and the #&b#idy a# %o#t.
My on int&ition i# that the probabi%ity o$ a bargaining $ai%&re) even tho&gh there i# a :DE() i%% increa#e a# the n&mber o$
the partie# to a negotiation goe# &p) i$ each ha# a veto. (nd even i$ a dea% i# made) . o&%d a%#o predict that the tran#action
co#t# o$ reaching agreement are %ike%y to be m&ch higher than ith a %e## #trict deci#ion r&%e.
E&tting the ho%do&t i##&e a#ide) there i# an even more $&ndamenta% i##&e. (# partie# are added) i$ each ha# a veto) it o&%d
#tand to rea#on that the ri#k o$ there being no :DE( increa#e#. +hi# i# not a prob%em i$ one be%ieve# a negotiated dea% #ho&%d
not be po##ib%e i$ it ha# even #%ight%y &n$avorab%e di#trib&tiona% con#e,&ence# $or even one party. 3&t in the m&%tiparty
conte2t) there o$ten may be #it&ation# here the gain# $or the inner# $rom a #ocia% per#pective are tho&ght to #&b#tantia%%y
o&teigh the %o##e# o$ the %o#er#. "hat i$ a po##ib%e agreement bene$it# near%y a%% o$ the partie# a great dea%) b&t impo#e#
#%ight %o##e# on a $e' 3eca&#e the Eareto*criterion impo#e# a di#trib&tion re,&irement that privi%ege# the #tat&# ,&o) the
%o#er# might be e2pected to e2erci#e their veto. (nd yet in many conte2t#) e#pecia%%y i$ #ide*payment# are not po##ib%e) one
might conc%&de that at %ea#t in term# o$ ea%th ma2imi6ation and ordinary notion# o$ e$$iciency) the comm&nity o&%d be
better o$$ ith the dea% even tho&gh it doe# not meet the re,&irement# o$ Eareto*e$$iciency.
.ntere#ting%y) &#ing the 7Ka%dor*Hick#7 compen#ation criterion a# a ay o$ de$ining economic e$$iciency avoid# the
con#traint# o$ the c%a##ica% Eareto*criterion. Ka%dor*Hick# a#k# hether it i# po##ib%e $or the inner# to make #ide payment# to
the %o#er# #o that the %o#er# o&%d be indi$$erent beteen the ne arrangement and the #tat&# ,&o. No #&ch #ide payment i#
act&a%%y re,&ired to be paid) hoever. .$) a# a theoretica% propo#ition) the gain# are #&$$icient to permit #&ch payment#) that i#
eno&gh to conc%&de that the propo#ed arrangement *17 i# more e$$icient that the #tat&# ,&o. .n Ka%dor># ord#) hether the
%o#er# 4#ho&%d be given compen#ation . . . i# a po%itica% ,&e#tion on hich an economi#t co&%d hard%y prono&nce an
opinion.531
3eca&#e the Ka%dor*Hick# te#t a#k# hether it might be po##ib%e to make a compen#atory payment) not hether in $act one i#
going to be made) it mitigate# the ho%do&t prob%em. -ome partie# might be made or#e o$$) b&t the ne arrangement o&%d
nonethe%e## be vieed a# more e$$icient than the o%d #tat&# ,&o. 3&t Ka%dor*Hick# i# hard%y a comp%ete #o%&tion to
determining economic e$$iciency in a m&%tiparty negotiation. (# a matter o$ economic theory) the criterion i# not itho&t it#
prob%em#) hether beca&#e o$ potentia% change# in re%ative price# or income e$$ect#.32 "hi%e app%ied economi#t# and po%icy
maker# may &#e co#t*bene$it ana%y#i# or 4ea%th ma2imi6ation5 princip%e# to eva%&ate economic e$$iciency) they are
imp%icit%y making 4a %eap o$ $aith)5 and 4eigh;ing< together 1ve># %o##e# and (dam># gain#.533 More $&ndamenta%%y) in a
negotiation) no #ocia% p%anner i# trying to eigh overa%% co#t# and bene$it# to a##e## hether a #&$$icient #ide*payment i#
theoretica%%y po##ib%e. .$ %e## than a%% can impo#e co#t# on a minority itho&t the need to make #ide*payment#) ho can e be
con$ident that the ne arrangement improve# #ocia% e%$are in compari#on ith the #tat&# ,&o'
Notith#tanding the#e concept&a% di$$ic&%tie#) in many conte2t# &nanimity re,&irement# are #imp%y bypa##ed beca&#e
#&bgro&p# can $orm coa%ition# and make their on agreement#) &ncon#trained by a veto o$ tho#e ho might be
di#advantaged. 4Dnce three or more con$%icting partie# are invo%ved) coa%ition# may $orm and act in concert again#t the other
di#p&tant#.538 +ho#e %e$t o&t o$ a coa%ition may o$ten be or#e o$$ than they ere be$ore negotiation# began. Hn%ike in
bi%atera% negotiation#) here typica%%y one party cannot a$$ect the other party># 3(+N() in m&%tiparty negotiation#) tho#e %e$t
o&t o$ dea% may o$ten $ind them#e%ve# or#e o$$ i$ no dea% ere made. Con#ider) $or e2amp%e) merger negotiation# in an
ind&#try ith three competing companie#. (%tho&gh a 4grand coa%ition5 invo%ving a merger o$ a%% three partie# might be
po##ib%e) #o too o&%d be merger# *18 beteen any to o$ the $irm#. Moreover) a merger beteen any to $irm# might make
the company %e$t o&t or#e o$$ than i$ no dea% ere made.3=
"henever coordinated action# or deci#ion# by %e## than a%% the partie# can change the #tat&# ,&o) the potentia% $or coa%itiona%
dynamic# become# part and parce% o$ m&%tiparty negotiation. "itho&t attempting to p%&mb $&%%y the concept&a% comp%e2itie#
o$ coa%ition#) it i# #a$e to a##ert that a variety o$ #trategic barrier# can ari#e that do not e2i#t in bi%atera% negotiation#. N*per#on
game theory demon#trate#) $or e2amp%e) that ith re#pect to game# that have no 4core)5 the prob%em i# not too many
e,&i%ibri&m#) b&t none. 4.$ a game ha# no core) it i# &n#tab%e in the #en#e that hatever the payo$$) #ome coa%ition ha# the
poer and motivation to break &p the imp&tation and go o$$ on it# on.53@ Coa%itiona% in#tabi%ity may %ead to an obvio&#
#trategic barrier in #&ch in#tance#.
I(. Decision-*a,ing Procedures in *u&ti+arty Negotiation: T"e -.a#+&e o$ /Su$$icient 'onsensus0
M&%ti%atera% negotiation# o$ten take p%ace ithin in#tit&tion# that have created proced&ra% r&%e# a%%oing %e## than a%% the
partie# to change the #tat&# ,&o) notith#tanding the obFection# o$ #ome.3A (n intere#ting ,&e#tion i# ho #&ch proced&re#
might be &#ed to mitigate the ho%do&t prob%em and a%%o a negotiated re#o%&tion that i# ide%y accepted a# %egitimate. Recent
e2amp%e# o$ comp%e2 m&%tiparty po%itica% negotiation# took p%ace in -o&th ($rica and Northern .re%and. .n -o&th ($rica) the
goa%# o$ the negotiation# ere to create an interim con#tit&tion) di#mant%e apartheid) and prepare $or the co&ntry># $ir#t open
e%ection#. .n Northern .re%and) the goa% a# to create a $rameork $or #e%$*government.
. am e#pecia%%y intrig&ed by the &#e o$ a 4#&$$icient con#en#&#5 criterion $or deci#ion*making in the comp%e2 m&%tiparty
po%itica% negotiation# that recent%y took p%ace in -o&th ($rica and Northern .re%and. .n both in#tance#) thi# #tandard mitigated
the ho%do&t prob%em and enco&raged the $ormation o$ a broad coa%ition o$ moderate centri#t partie# that had previo&#%y been
in deep con$%ict. .n each ca#e) *19 m&%tiparty negotiation# ere beg&n in the hope# o$ tran#$orming ba#ic po%itica%
in#tit&tion#.
+he p&rpo#e o$ the 4CDC1-(53B negotiation# and the M&%ti*Earty Negotiating Eroce## (4MENE5) in -o&th ($rica a# to
create an interim con#tit&tion that di#mant%ed apartheid and #et gro&nd r&%e# $or %egi#%ative e%ection# in hich a%% -o&th
($rican# eighteen year# or above o&%d vote. .n Northern .re%and) here the 4a%% party peace ta%k#5 invo%ved at %ea#t eight
partie#) Jeorge Mitche%% &#ed the #&$$icient con#en#&# mechani#m to orche#trate the e2tended negotiation proce## that %ed to
the 199B Jood /riday (ccord#) hich created a $rameork $or #e%$*government and ere #&b#e,&ent%y rati$ied in a
re$erend&m.
+he#e negotiation# invo%ved repre#entative# o$ many di$$erent po%itica% partie#**a# many a# tenty*#i2 partie# in -o&th ($rica)
and at %ea#t eight in Northern .re%and. .n both #it&ation#) partie# repre#enting a #ing%e race (i.e.) b%ack# in -o&th ($rica) or a
#ing%e re%igion (i.e.) Erote#tant# in Northern .re%and) might have c%aimed to #peak $or a maFority o$ the tota% pop&%ation. 3&t
deci#ion*making by #&ch a maFority co&%d never have re#o%ved either con$%ict. +he cha%%enge in both negotiation# a# to b&i%d
a coa%ition o$ moderate centri#t partie# acro## racia% or re%igio&# %ine# and prevent more e2treme partie#**b%ack or hite)
Catho%ic or Erote#tant**$rom b%ocking progre##. -&$$icient con#en#&# a# a ay in both in#tance# to maintain a #pirit o$
inc%&#ivene## hi%e avoiding the #trict&re# o$ &nanimity.
A. De$ining Su$$icient 'onsensus
"hat a# the 4#&$$icient con#en#&#5 criterion' .t di$$ered #omehat in the to ca#e#. .n -o&th ($rica) there a# no attempt to
de$ine the preci#e ,&antitative re,&irement) b&t a r&%e did enco&rage a proce## o$ broad participation and #&pport. .n Northern
.re%and) the $orma% te#t a# more comp%icated and had #evera% component#.
1. T"e Test o$ Su$$icient 'onsensus in Sout" A$rica
(ccording to the -tanding R&%e# o$ the M&%ti*Earty Negotiating Eroce##) #&$$icient con#en#&# orked a# $o%%o#0 "hen the
chair o$ any o$ the n&mero&# #pecia%i6ed committee# charged ith partic&%ar i##&e# determined that &nanimity) or 4genera%
con#en#&#)5 co&%d not be initia%%y achieved on an i##&e) the committee a# in#tr&cted to &#e
*20 a variety o$ mechani#m# in order to reach the ide#t po##ib%e con#en#&#. .n partic&%ar #&ch mechani#m ;#ic< #ha%% inc%&de
adFo&rnment# to enab%e in$orma% di#c&##ion# beteen participant#) #etting &p technica% committee# compo#ed a# the meeting
deem# appropriate $or the partic&%ar matter &nder con#ideration) a# e%% a# a%%oing participant# to con#&%t their principa%#.39
.$ &nanimity #ti%% co&%d not be reached) the chair co&%d then decide 7at hi#Mher di#cretion7 hether #&$$icient con#en#&#
e2i#ted. Eartie# #ti%% obFecting might di#p&te the deci#ion) b&t the intention a# that 4in the #pirit o$ cooperation ;they o&%d<
not hinder the proce## $rom going $orard.580
-&$$icient con#en#&# a# &#ed a# a deci#ion*making mechani#m many time# in the 1991*1998 period o$ -o&th ($rica>#
tran#ition) b&t mo#t notab%y to #et the date $or e%ection# to a $ina% con#tit&tion*making body. Dn ?&ne 3) 1993) the ($rican
Nationa% Congre##) the moderate b%ack organi6ation %ed by Ne%#on Mande%a) propo#ed (pri% 2A) 1998 a# the e%ection date
a$ter a $%&rry o$ ta%k# and conce##ion# to #ma%%er b%ack partie#. (# part o$ the propo#a%) the (NC a%#o #tip&%ated that
$ina%i6ation o$ the deci#ion be po#tponed &nti% ?&ne 1=) in order to 4ma2imi6e con#en#&# on thi# matter.5 81 Dn ?&ne 1=) a
#ma%%er gro&p) the .nkatha /reedom Earty (4./E5)) p&t $orard a motion o$ it# on) that 4any $ina% determination o$ the
e%ection date be po#tponed5 &nti% #evera% condition# had been met.82 /i$teen o$ the gro&p# pre#ent voted again#t the ./E>#
motion and eight voted $or it. M.?. Mah%ang&) then the chair o$ the negotiating co&nci% in hich the e%ection date a# to be
determined) r&%ed that there a# not #&$$icient con#en#&# $or the ./E motion. +hi# meant) in e$$ect) that there a# #&$$icient
con#en#&# $or the (pri% 2A) 1998 e%ection date.83
2. T"e Test o$ Su$$icient 'onsensus in Nort"ern Ire&and
.n Northern .re%and) #&$$icient con#en#&# a# #aid to e2i#t $or an i##&e here there a# agreement that a# #&pported by0 (1)
partie# *21 repre#enting a maFority o$ the Catho%ic comm&nity! (2) partie# repre#enting a maFority o$ the Erote#tant
comm&nity! (3) a n&merica% maFority o$ a%% the partie# pre#ent at the ta%k#! and (8) the government# o$ the Rep&b%ic o$ .re%and
and the Hnited Kingdom.
"herea# the MENE -tanding R&%e# #tip&%ated that #&$$icient con#en#&# be &#ed 4$or re#o%ving #&b#tantia% i##&e# and not $or
$orma% and admini#trative deci#ion#)588 #&$$icient con#en#&# in Northern .re%and enFoyed a m&ch broader app%ication. Jeorge
Mitche%%) one o$ the ta%k#> chairmen) &#ed it to make many proced&ra% and admini#trative deci#ion#. /re,&ent%y) imp%ementing
#&$$icient con#en#&# made the negotiation# protracted and $r&#trating) b&t it a%#o a%%oed Mitche%% to gain tr&#t and e#tab%i#h
a&thority ith the negotiator#. .n Northern .re%and) #&$$icient con#en#&# a# mo#t memorab%y emp%oyed to adopt the very
7R&%e# o$ Eroced&re7 that introd&ced it. .n %ate ?&%y 199@) it %ooked a# tho&gh the negotiation participant# o&%d not be ab%e to
agree on a #et o$ gro&nd r&%e# be$ore the (&g&#t rece##. /ina%%y) Eeter Robin#on) a de%egate $rom the Cemocratic Hnioni#t
Earty (4CHE5)) #&gge#ted that the de%egate# vote on each individ&a% #ection o$ the propo#ed r&%e# and on the r&%e# a# a ho%e.
+ho#e ith obFection# co&%d vote) i$ they #o de#ired) again#t each o$ the individ&a% r&%e#) b&t then vote $or the r&%e# a# a
ho%e. +hat ay) minority partie# concerned ith maintaining their rep&tation# ith their con#tit&encie# co&%d appear a#
having voted overhe%ming%y again#t the r&%e#) hi%e #ti%% enab%ing them to pa##.8=
B. T"e Su$$icient 'onsensus 'riterion -#+owered t"e *a3or *oderate Parties
3oth -o&th ($rica and Northern .re%and># #&$$icient con#en#&# had the e$$ect o$ creating a poer$&% centri#t coa%ition
re#pon#ib%e $or mo#t o$ the progre## in the ta%k#.
1. Sout" A$rica
.n the -o&th ($rican negotiation#) #&$$icient con#en#&# a# #aid to e2i#t hen there a# agreement beteen the Nationa%
Earty (4NE5)) /.". de K%erk># party hich repre#ented a maFority o$ hite#) and the ($rican Nationa% Congre## (4(NC5))
Ne%#on Mande%a># party *22 and by $ar the %arge#t b%ack party. +ho#e ho di#agreed ith a po##ib%e deci#ion ere
enco&raged to voice their obFection# and tho#e obFection# o&%d be d&%y con#idered and taken #erio&#%y. 3&t hen nece##ary
$or progre##) a deci#ion by the NE and (NC o&%d genera%%y be eno&gh $or #&$$icient con#en#&#) even i$ the concern# o$ a
minority co&%d not be #ati#$ied.
4(ccording to one acco&nt)5 rite# the Centre $or Eo%icy -t&die# in it# 1993 report on the negotiation#) 4thi# magica%
princip%e a# anno&nced to a #enior Code#a participant the night be$ore the convention began by a key NE negotiator and hi#
(NC co&nterpart. 7"hat doe# 4#&$$icient con#en#&#5 mean'> the participant a#ked. 7"hatever e ;the (NC and NE< decide it
mean#)> a# the rep%y.58@ +he 4Record o$ Hnder#tanding)5 $or e2amp%e**a doc&ment created by the (NC and the NE in
-eptember 1992 that dea%# ith the character o$ po#t*apartheid in#tit&tion#**i# evidence o$ a #trong moderate b%oc in the
-o&th ($rica negotiation#. 3y o$$icia%%y reconci%ing the vie# o$ the (NC and the NE on maFor i##&e#) the Record o$
Hnder#tanding en#&red #moother $&t&re negotiation# and prevented ta%k# $rom becoming mired in the obFection# o$ e2treme
gro&p#! the (NC and NE o&%d agree on an i##&e $ir#t) and then bring it be$ore the re#t o$ the partie# $or con#ideration. Dther
partie#) #&ch a# the ./E and E(C (4Ean*($ricani#t Congre##5)) and %eader# #&ch a# D&pa J,o6o o$ Ci#kei and L&ca# Mangope
o$ 3oph&that#ana) acc&#ed the (NC and NE o$ co%%&#ion) b&t the $act remain# that the (NC*NE coa%ition provided the
$rameork $or near%y a%% the negotiation# o$ -o&th ($rica># tran#ition.
2. Nort"ern Ire&and
.n Northern .re%and) #&$$icient con#en#&# enab%ed the -ocia% Cemocratic Labo&r Earty (4-CLE5) and the H%#ter Hnioni#t
Earty (4HHE5)) the to %arge#t and mo#t moderate po%itica% gro&p#) to $orm a centri#t coa%ition ith con#iderab%e poer. +he
term# o$ the deci#ion*making mechani#m ere #&ch that i$ either party did not agree to a propo#a%) that propo#a% co&%d not
pa##. 7.t e##entia%%y provided that the o&tcome o$ the ta%k# co&%d not re$%ect a one*#ided victory by one overa%% $action or
another. (# #&ch) any re#&%t o&%d need the #&pport o$ a centri#t coa%ition.78A 3y giving the -CLE and HHE the *23 abi%ity to
veto propo#a%#**the #o&rce o$ a rea% #en#e o$ poer** #&$$icient con#en#&# a$$orded the to %arge) moderate partie# a 7#a$er7
environment in hich to cooperate and make conce##ion#.8B
'. Su$$icient 'onsensus Had t"e -$$ect o$ Si#+&i$ying t"e *u&ti+arty Negotiations
.n the negotiation# o$ -o&th ($rica and Northern .re%and) mo#t o$ the #&b#tantive progre## a# made in #ma%%) &#&a%%y
bi%atera% or tri%atera% ta%k#. .n -o&th ($rica) thi# a# the ca#e $rom the very beginning. .n Northern .re%and) the chairmen made
ear%y attempt# to cond&ct negotiation# a# a%%*party ta%k#) b&t %ater opted $or #ma%%er gro&p#. +hi# #ty%e o$ proced&re a#
adopted o&t o$ con#ideration# o$ e$$iciency and made po##ib%e by #&$$icient con#en#&#. -&$$icient con#en#&# co&%d o$ten
red&ce a cacophono&# and ine$$ective m&%tiparty negotiation into a to*party negotiation beteen the organi6ation# o$ the
moderate coa%ition and their a$$i%iate#.
1. Sout" A$rica
1ven be$ore CDC1-( a# convened $or the $ir#t time) the (NC and NE had been engaged in bi%atera% ta%k#) and thi#
coa%ition g&ided the progre## o$ a%% o$ the con#tit&tiona% negotiation#. +he $ir#t CDC1-( a# cond&cted on%y in p%enary ta%k#)
one re#&%t o$ hich a# the Cec%aration o$ .ntent) 4a #et o$ princip%e# and p&rpo#e# to g&ide CDC1-(.589 +he co%%ective
#igning o$ thi# doc&ment gave the impre##ion o$ a tr&e a%%*party negotiation. Hoever) 4Code#a 1 a# in the main a rit&a%i#tic
event) apparent%y de#igned more to impre## a dome#tic p&b%ic and $oreign dignitarie#.5=0 +he con$erence># organi6er# began
thi# $ormat ith the pre## and the p&b%ic in mind! the p%enary meeting# ere %arge%y ceremonia%. +he rea% negotiation# o&%d
take p%ace not in p%enarie#) b&t in the $ive #ma%%er 4"orking Jro&p#5 that the Cec%aration o$ .ntent de%ineated. +hey had a
#imi%ar compo#ition0 a p%enary that met on%y #poradica%%y! three #ma%%er gro&p#! and #even technica% committee#. "rite# -i#k)
the 4centra% deci#ion*making #tr&ct&re o$ the 20B*member) tenty*#i2 party) par%iamentary*#ty%e a##emb%y a# the ten*per#on
Negotiating Co&nci%.5=1 Hoever) not even the#e e%even #ma%%er gro&p# ere re#pon#ib%e $or a%% o$ the negotiation0 7;M<&ch
pre%iminary bargaining a# cond&cted *24 in a #erie# o$ behind*the*#cene# bi%atera% ta%k# thro&gho&t 1993.5=2 .n the end) the
#tr&ct&re o$ -o&th ($rica># ta%k# a# m&ch the #ame a# Northern .re%and>#0 the (NC and the NE ere a$$orded the abi%ity to
behave a# tho&gh they ere participating in to*party negotiation# beca&#e the #&$$icient con#en#&# criterion re,&ired that
on%y they agree $or a deci#ion to be taken.
2. Nort"ern Ire&and
Hnti% ear%y ?&%y 199@) p%enary meeting# o$ the Northern .re%and peace proce## ere he%d in a room ith #i2ty*eight peop%e
aro&nd a %arge) #,&are) ring*#haped tab%e) a #it&ation 4more cond&cive to attack than to compromi#e.5=3 +he#e p%enary
meeting# ere %arge to the point o$ being &nie%dy) and deci#ion*making) even by #&$$icient con#en#&#) a# %aborio&#.
3eca&#e the#e meeting# a%#o took p%ace aro&nd 7marching #ea#on7 and ere not making progre##) Mitche%% cance%%ed the
p%enary #e##ion# $or the ne2t to eek# and in#tead #ched&%ed bi%atera% meeting#.
+he#e ta%k# made more progre## than the a%%*party one# had) and $rom then on) Mitche%% made &#e o$ hat Mark C&rkan o$
the -CLE de%egation ca%%ed
7variab%e geometry>**the concept o$ $%e2ibi%ity in the #hape and #i6e o$ meeting#. 3i%atera% di#c&##ion# beteen the HHE and
the -CLE and %ater tri%atera% di#c&##ion# invo%ving the (%%iance managed to prod&ce a orking paper on decommi##ioning on
hich there a#) even according to HHE #o&rce#) ninety per cent agreement. (t the #ame time) bi%atera% di#c&##ion# had
prod&ced agreement beteen the -CLE and the HHE on a po##ib%e Comprehen#ive (genda $or the #&b#tantive negotiation#
hich a# de#igned to rea##&re each party abo&t the intention# o$ the other.=8
+he #&cce## o$ variab%e geometry can be attrib&ted to #&$$icient con#en#&#. +he bi%atera% ta%k# beteen the -CLE and the
HHE ere e2treme%y important beca&#e they ere the gro&p# ho#e approva% con#tit&ted #&$$icient con#en#&#. "hen the#e
to moderate partie# co&%d agree on #omething) #&$$icient con#en#&# a# con#idered to be attained. +he to moderate partie#
had the privi%ege o$ behaving a# *25 tho&gh they ere part o$ a to*party negotiation rather than a m&%tiparty one.
D. T"e -$$ects o$ t"e Su$$icient 'onsensus 'riterion on t"e *inor and *ore -.tre#e Parties
/or minor partie# that ere not e2treme) the #&$$icient con#en#&# criterion enco&raged them to Foin the maFor party in $orming
a centri#t coa%ition. +he more intere#ting e$$ect a# on the o&t%ier#. .n both -o&th ($rica and Northern .re%and) the &#e o$
#&$$icient con#en#&# #&bFected more e2treme partie# to very di$$ic&%t choice#. "hen a deci#ion ent again#t an o&t%ier>#
intere#t#) one option a# to bo%t $rom the negotiation# and ork to &ndermine the proce## $rom the o&t#ide. +he a%ternative
a# to remain in the negotiation# ith the hope o$ con#training $&t&re action#.
1. Sout" A$rica
.n -o&th ($rica) the ten#ion beteen anting to take part in the negotiation# and anting to prevent the $ormation o$ an
agreement i# be#t e2emp%i$ied by the .nkatha /reedom Earty. +he ./E participated in the $ir#t CDC1-() b&t beca&#e o$ the
po#ition it took on #ome i##&e#) it 4began to be #een not on%y a# an o&tbidder on the government># right b&t a# an in#ec&re
po%itica% $oe o$ the (NC) th&# #etting it#e%$ &p a# a potentia% #poi%er.5== .t a# at the $ir#t CDC1-( that the ./E 4revea%ed it#
on &nder#tanding o$ being a minority) regiona%%y ba#ed party5!=@ it a# not one o$ the gro&p# ho#e approva% a# needed
$or #&$$icient con#en#&#. +he ./E a%#o participated in MENE) hich took p%ace beginning in (pri% 1993) b&t a%ked o&t o$ the
negotiation# that ?&ne a$ter rea%i6ing that #&$$icient con#en#&# o&%d a%%o the centri#t (NC*NE coa%ition to #et the e%ection
date regard%e## o$ it# obFection. +he ./E then #hi$ted gear# $rom participating in negotiation# to trying to prevent an
agreement $rom taking p%ace. .t bro&ght a #&it cha%%enging #&$$icient con#en#&# be$ore the -o&th ($rican -&preme Co&rt in
-eptember o$ that year) b&t the ca#e a# &%timate%y di#mi##ed.=A
*26 2. Nort"ern Ire&and
.n Northern .re%and) the Cemocratic Hnioni#t Earty (4CHE5)) a more e2treme Erote#tant Earty) $o&nd it#e%$ in a #imi%ar
#it&ation. "hen -inn /Nin a# admitted to ta%k# in ?&%y 199A a# a re#&%t o$ a deci#ion ba#ed on #&$$icient con#en#&#) both the
CHE and another %oya%i#t party) the Hnited Kingdom Hnioni#t Earty (4HKHE5)) #tormed o&t o$ ta%k# and never ret&rned.
+hey had been participating in ta%k#) b&t their avoed aim 4a# they repeated%y in#i#ted) ;a#< to end thi# proce##.5=B
Hoever) the CHE and HKHE %earned $ir#thand the di%emma o$ the di##enting minor party in m&%tiparty ta%k# ith a
#&$$icient con#en#&# criterion. "rite# Mitche%%) 7their a%ko&t a# a $ate$&% error . . . . +heir ab#ence $reed the HHE $rom dai%y
attack# at the negotiating tab%e) and gave the party room to negotiate that it might not otheri#e have had.5=9 +he deci#ion o$
the#e %oya%i#t partie# to ,&it negotiation# co&%d not prevent an agreement $rom taking p%ace. .n thi# ca#e) it may have act&a%%y
$aci%itated the proce##) %eaving the CHE and HKHE in a or#e #it&ation than they had been hi%e participating in the ta%k#)
beca&#e no they had no in$%&ence hat#oever over an agreement. ($ter %eaving the ta%k#) .an Eai#%ey) the CHE %eader) made
a %a#t*ditch e$$ort to prevent an agreement. .n ear%y (pri% 199B) hen the -CLE and the HHE anno&nced agreement on
#&b#tantia% i##&e#) Eai#%ey #hoed &p at the ta%k#> ven&e ith an ento&rage0
/or month#) Eai#%ey and hi# co%%eag&e# had $o&nd them#e%ve# practica%%y ignored by the media a$ter #ta%king o&t o$
negotiation#! no they ere determined to make their pre#ence $e%t. Eai#%ey to%d an e2cited gathering o$ $%ag*aving %oya%i#t#
c%o#e to the ta%k#0 7Oo& have got the right to come &p here tonight and demon#trate that it># No -&rrenderP>@0
Eai#%ey># e$$ort# ere %arge%y #corned by tho#e pre#ent) b&t the important a#pect o$ thi# anecdote i# Eai#%ey># #hi$t $rom a
participant in negotiation# ith #ome abi%ity to in$%&ence their o&tcome) to an o&t#ider itho&t in$%&ence) trying de#perate%y to
end them.
(. 'onc&usion
( n&mber o$ year# ago) . #&gge#ted that an important inte%%ect&a% ta#k re,&ire# the e2p%oration o$ hy) &nder circ&m#tance#
hen *27 partie# might make them#e%ve# better o$$ thro&gh a negotiated re#o%&tion o$ con$%ict) negotiation# o$ten $ai%ed.
Negotiation obvio&#%y invo%ve# #trategic interaction**i.e.) Foint deci#ion*making in hich each party># choice# m&#t
nece##ari%y be in$%&enced by hat he think# other partie# are %ike%y to do. +hi# artic%e ha# #o&ght to e2p%ore #trategic barrier#)
both in the bi%atera% and m&%ti%atera% conte2t. "hat conc%&#ion# might be dran $rom thi# mode#t $oray'
/ir#t) negotiation ana%y#i# p%ain%y indicate# that #trategic barrier# o$ten do e2i#t. .n #ome circ&m#tance#) the rationa% p&r#&it o$
di#trib&tive gain in negotiation can %ead to ine$$icient o&tcome#. . have #&gge#ted hy thi# i# #o in bi%atera% negotiation#) and
my on be%ie$ i# that it i# even more the ca#e in m&%ti%atera% negotiation#.
-econd) game theoretica% ana%y#i# o$$er# he%p$&% in#ight# into #trategic interaction) b&t in many circ&m#tance#) it i# not a
&#e$&% #o&rce $or pre#criptive advice to tho#e act&a%%y engaged in negotiation#. 3eca&#e game theory re,&ire# $orma% ana%y#i#
in mathematica% term#) the r&%e# o$ the game m&#t be e%% #peci$ied in advance. (# my brie$ e2p%oration# o$ the m&%tiparty
negotiation# in -o&th ($rica and Northern .re%and demon#trate) deci#ion r&%e# can have a poer$&% impact on the po##ibi%ity
that inning coa%ition# can be $ormed and the comparative capacity o$ di$$erent partie# to in$%&ence the $ina% o&tcome. .n
negotiation# genera%%y and e#pecia%%y in m&%tiparty negotiation#) the $orm o$ #trategic interaction o$ten invo%ve# adding or
#&btracting i##&e#) adding or #&btracting partie# to the negotiation) negotiating abo&t the content o$ deci#ion r&%e#) and
attempting to manip&%ate the agenda. -&ch comp%e2itie# typica%%y cannot be mathematica%%y mode%ed.
D&r &nder#tanding o$ con$%ict re#o%&tion o&%d #&re%y be enriched by care$&% e2p%oration o$ barrier# $rom the per#pective# o$
a variety o$ the #ocia% #cience#) certain%y game theory and the economic# o$ bargaining have m&ch to contrib&te. 3&t my on
be%ie$ i# that no theoretica% per#pective) and no #ing%e di#cip%ine) ha# a monopo%y on &#e$&% in#ight# concerning the barrier# to
the $air and e$$icient re#o%&tion o$ con$%ict. .ndeed) . #&#pect that progre## i%% t&rn very $&ndamenta%%y on the abi%ity o$
peop%e $rom di$$erent di#cip%ine# to %earn $rom one another and to ork together to improve both theory and practice. D&r
goa% #ho&%d &%timate%y be to go beyond #imp%y &nder#tanding hy negotiation# #ometime# $ai% and #ometime# #&cceed. .t
#ho&%d be to he%p &# overcome the barrier# and achieve more con#i#tent #&cce## in the negotiated re#o%&tion o$ con$%ict.
/ootnote#
d1 . o&%d %ike to grate$&%%y ackno%edge the va%&ab%e re#earch a##i#tance o$ Karen +enenba&m and L&ka#6 Ro6deic6er. (n ear%ier
ver#ion o$ thi# artic%e a# pre#ented at a con$erence on Ca&#e# and Management o$ Con$%ict# in "oer%it6) Jermany in ?&ne)
2002) and a# previo&#%y p&b%i#hed a# part o$ the con$erence proceeding# in 1=9 ?. .n#tit&tiona% and +heoretica% 1con. 199
(2003). .t i# p&b%i#hed here ith the permi##ion o$ that Fo&rna%.
1 Robert H. Mnookin) "hy Negotiation# /ai%0 (n 12p%oration o$ 3arrier# to the Re#o%&tion o$ Con$%ict) B Dhio -t. ?. on Ci#p.
Re#o%. 23= (1993).
2 Robert H. Mnookin Q Lee Ro##) 3arrier# to Con$%ict Re#o%&tion (Kenneth (rro Q Robert H. Mnookin et a%. ed#.) EDN 3ook#
1999).
3 -ee Cavid M. Krep#) Jame +heory and 1conomic Mode%ing (1990).
8 (nato% Rapoport) N*Eer#on Jame +heory @A (19A0).
= .nternationa% M&%ti%atera% Negotiation (pproache# to the Management o$ Comp%e2ity 2i ("i%%iam :artman ed.) 1998).
@ Hoard Rai$$a) +he (rt and -cience o$ Negotiation 11 (19B2).
A Cavid (. La2 Q ?ame# K. -ebeni&#) +hinking Coa%itiona%%y0 Earty (rithmetic) Eroce## Dpport&ni#m) and -trategic -e,&encing)
in Negotiation (na%y#i# 1=3 (H. Eeyton Oo&ng ed.) 1991) ;hereina$ter La2 Q -ebeni&#) +hinking Coa%itiona%%y<.
B Robert Mnookin Q Lei# Kornha&#er) 3argaining in the -hado o$ La0 the Ca#e o$ Civorce) BB Oa%e L.?. 9=0 (19A9).
9 1%eanor 1. Maccoby Q Robert H. Mnookin) Cividing the Chi%d0 -ocia% and Lega% Ci%emma# o$ C&#tody (1992).
10 Robert Mnookin) 3eyond "inning0 Negotiating to Create Ga%&e in Cea%# and Ci#p&te# (2000).
11 -ee id. at 29=*318.
12 -ee id. at 9*10.
13 +hi# phra#e) hich ha# no entered the #tandard negotiation vocab&%ary) a# #&gge#ted $ir#t by /i#her and Hry. -ee Roger /i#her
et a%.) Jetting to Oe#0 Negotiating (greement "itho&t Jiving .n 9A (19B3).
18 Morton C. Cavi#) Jame +heory 8= (19A0).
1= -ee Jeorge (. (ker%o$) +he Market $or 4Lemon#50 R&a%ity Hncertainty and the Market Mechani#m) B8 R.?. 1con. 8BB (19A0).
1@ Commitment #trategie# invo%ve per#&ading the other #ide that yo& have no $reedom o$ choice. .n a c%a##ic e2amp%e o$ten
attrib&ted to +homa# -che%%ing) to car# begin to enter an inter#ection at the #ame time. 3oth driver# ant to get thro&gh the
inter#ection $ir#t b&t neither ant# a co%%i#ion. 3&t i$ one driver co&%d detach hi# #teering hee% and con#pic&o&#%y thro it o&t o$
the car) the other driver o&%d have to permit him to pa## thro&gh. "hy' 3eca&#e the $ir#t driver ha# changed the #econd driver>#
option#. He m&#t no de$er or ca&#e a co%%i#ion) herea# be$ore there a# #ome chance that the other driver o&%d #%o don
$ir#t.
Commitment #trategie# come in many $orm# b&t to be e$$ective) a commitment m&#t #eem binding. Creating a commitment that
i# credib%y irrever#ib%e i# not ea#y) beca&#e o$ten a party i%% be perceived a# having the poer to change co&r#e. -ee genera%%y
+homa# C. -che%%ing) +he -trategy o$ Con$%ict (19@0). -ometime# commitment #trategie# invo%ve making promi#e# to third
partie#. /or e2amp%e) a b&yer (ho a# a member o$ the Cemocratic Earty) might #omeho commit to paying I2)000 to a right*
ing charity i$ he pay# a #e%%er more than IA)000 $or a good. +hi# commitment) i$ credib%e) might e%% per#&ade a re%&ctant #e%%er
to accept the b&yer># 4$ina%5 take*it*or*%eave*it o$$er o$ IA)000.
1A Cavi#) #&pra note 18) at 119*20.
1B Krep#) #&pra note 3) at 92.
19 .d. at 98.
20 .d. at 9A.
21 .d. at 9A.
22 -ee ?ohn /. Na#h) ?r.) +he 3argaining Erob%em) 1B 1conometrica 1== (19=0).
23 -ee (rie% R&bin#tein) Eer$ect 1,&i%ibri&m .n a 3argaining Mode%) =0 1conometrica 9A (19=0).
28 Krep#) $or e2amp%e) #&gge#t# that i$ ( can make o$$er# a$ter = #econd# hi%e it take# 3 1= #econd#) the R&bin#tein e,&i%ibri&m
i%% give 3M8 o$ the #&rp%&# to p%ayer ( and on%y 1M8 to 3. -ee Krep#) #&pra note 3) at 12@*2A.
2= -ee Cre /&ndenberg Q ?ean +iro%e) Jame +heory 181 (1991).
2@ 1mpirica% re#earch a%#o #ho# that R&bin#tein># a%ternating o$$er mode% doe# not acc&rate%y de#cribe bargaining behavior in
e2perimenta% #it&ation# &#ing R&bin#tein># protoco%#. -ee (%vin 1. Roth) +he Handbook o$ 12perimenta% 1conomic# 2=3*38B
(?ohn H. Kage% Q (%vin 1. Roth ed#.) 199=).
2A .d.
2B -ee Ha% R. Garian) .ntermediate Microeconomic#0 ( Modern (pproach 1= (1999).
29 -ee Cynamic (dmini#tration0 +he Co%%ected Eaper# o$ Mary Earker /o%%ett (Henry C. Metca%$ Q L. Hrick ed#.) 1982)! Richard
1. "a%ton Q Robert 3. McKer#ie) ( 3ehaviora% +heory o$ Labor Negotiation#0 (n (na%y#i# o$ a -ocia% .nteraction -y#tem
(19@=)! #ee a%#o Cean J. Er&itt) Negotiation 3ehavior (19B1)! Hoard Rai$$a) +he (rt and -cience o$ Negotiation 11 (19B2)!
Cavid (. La2 Q ?ame# K. -ebeni&#) +he Manager a# Negotiator0 3argaining $or Cooperation and Competitive Jain (19B@)!
/i#her et a%.) #&pra note 13.
30 +he i##&e# are di#c&##ed at %ength in Mnookin) 3eyond "inning) #&pra note 10) and in Mnookin Q Ro##) #&pra note 2) at 3*28.
31 Nicho%a# Ka%dor) "e%$are Eropo#ition# o$ 1conomic# and .nterper#ona% Compari#on# o$ Hti%ity) 89 1con. ?. =89 (1939).
32 -citov#ky and -am&e%#on #&b#e,&ent%y revea%ed tro&b%ing prob%em# ith Ka%dor*Hick# hen one compared circ&m#tance#
here the to #tate# o$ the or%d invo%ved di$$erent combination# o$ good#. -ee (. /riedman) Ka%dor*Hick# Compen#ation) in
+he Ne Ea%grave Cictionary o$ 1conomic# and La (E. Neman ed.) 199B). -ee genera%%y La2 Q -ebeni&#) +hinking
Coa%itiona%%y) #&pra note A.
33 La2 Q -ebeni&#) +hinking Coa%itiona%%y) #&pra note A) at 821.
38 Rai$$a) #&pra note @) at 11.
3= -ee id. at 2=A*@2.
3@ Morton C. Cavi#) Jame +heory0 ( Nontechnica% .ntrod&ction 1B8 (19B3).
3A -ee genera%%y La2 Q -ebeni&#) +hinking Coa%itiona%%y) #&pra note A) at 1=3 (noting that #cho%ar# have #t&died the $ormation o$
coa%ition# ithin the#e in#tit&tion# and the e$$ect# o$ voting proced&re# and agenda #etting on negotiation# ithin %egi#%at&re#)
internationa% a%%iance#) and in treaty making).
3B CDC1-( #tand# $or the Convention $or a Cemocratic -o&th ($rica) hich met in Cecember 1991. ( #econd CDC1-( took
p%ace in May 1992. +he M&%ti*Earty Negotiating Eroce##) hich $ir#t convened in (pri% 1993) a# CDC1-(># #&cce##or.
39 Jov>t o$ the -e%$*Joverning +erritory o$ Ka:&%& v. Mah%ang&) 1998 (1) -( @2@) @30 (+EC).
80 .d. at @29.
81 .d. at @31.
82 .d.
83 +he ./E di#p&ted Mah%ang&># deci#ion and cha%%enged the &#e o$ #&$$icient con#en#&# in a -eptember 1993 -o&th ($rican
-&preme Co&rt ca#e. +he Co&rt di#mi##ed the ca#e) citing the app%icant># inabi%ity to demon#trate that deci#ion# taken by
#&$$icient con#en#&# ere %ega%%y binding.
88 Ka:&%&) 1998 (1) -( at @30.
8= Canie% /. C&rran and ?ame# K. -ebeni&#) +he Mediator a# Coa%ition 3&i%der0 Jeorge Mitche%% in Northern .re%and) B ?. .nt>%
Negot. ($orthcoming 2003).
8@ +he Long ?o&rney0 -o&th ($rica># R&e#t $or a Negotiated -ett%ement 28*2= (-teven /riedman ed.) 1993).
8A C&rran Q -ebeni&#) #&pra note 8=.
8B .d.
89 +imothy C. -i#k) Cemocrati6ation in -o&th ($rica 20= (199=).
=0 +he Long ?o&rney0 -o&th ($rica># R&e#t $or a Negotiated -ett%ement) #&pra note 8=) at 23.
=1 -i#k) #&pra note 89) at 22@.
=2 .d.
=3 Harvard 3&#ine## -choo% Ca#e 9*B01*393) +o He%% "ith the /&t&re) Let># Jet Dn "ith the Ea#t0 Jeorge Mitche%% .n Northern
.re%and 13 (Canie% /. C&rran and ?ame# K. -ebeni&# ed#.) 2001).
=8 .d. at 1@.
== -i#k) #&pra note 89) at 20A.
=@ .d.
=A .n it# deci#ion to di#mi## the ca#e) the -&preme Co&rt cited the ./E># inabi%ity to demon#trate that deci#ion# taken by #&$$icient
con#en#&# ere binding. (# evidence) it pointed to the ./E># on a%ko&t) hich) it arg&ed) o&%d not have been po##ib%e i$
#&$$icient con#en#&# entai%ed a %ega%%y binding re%ation#hip. Ka:&%&) 1998 (1) -( at @30.
=B Jeorge ?. Mitche%%) Making Eeace 110 (1999).
=9 .d.
@0 1amonn Ma%%ie Q Cavid McKittrick) 1ndgame in .re%and 23=*3@ (2001).
-nd o$ Docu#ent S 2011 +hom#on Re&ter#. No c%aim to origina% H.-. Jovernment "ork#.

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