economics and management 376: negotiation and...

Economics and Management 376: Negotiation and Dispute Resolution Fall 2010

Professor Greg Saltzman

Office: Room 101 Robinson, tel. 0422, E-mail [email protected]

Home telephone: (734) 971-7596 (not after 9:30 PM, please)

Office hours: MTuWTh 10 – 11 AM

Please feel free to stop by my office without an appointment, though you can make an

appointment if you wish. I am frequently in my Albion office at the following times:

Mondays 9:45-11 AM and 1-4 PM (but I will teach 2:10-3:30 mid Oct-Dec)

Tuesdays 9:45-11 AM and 1-2 PM

Wednesdays 9:45-11 AM and 1-4 PM (but I will teach 2:10-3:30 mid Oct-Dec)

Thursdays 9:45-11 AM and 1-2 PM

Fridays Almost never. (At home or at my University of Michigan office.)

If you make prior arrangements with me, then I am also happy to meet with you in my office

some Mondays, most Tuesdays or Wednesdays, and a few Thursdays from 12 to 1 PM.

Classes Tuesdays and Thursdays, 2:10-4, Norris 100.

An introductory study of the theories and concepts related to negotiation and dispute resolution

developed in such fields as microeconomics, psychology and industrial relations. Includes many

role-playing exercises to provide students with practice in negotiation.

Prerequisite: Junior or senior standing. Background in microeconomics, social psychology,

cognitive psychology, or communications is helpful but not required. Excellent English

composition skills will help you receive higher grades on the written assignments.

Negotiation is the art and science of securing agreements between two or more interdependent

parties. In the past decade, society has given increased attention to negotiation as a technique to

resolve many different kinds of disputes, including legal, managerial, environmental, community,

and family disputes. At the same time, the scholarly literature on negotiation and dispute

resolution has expanded rapidly.

The role-playing exercises in this course will put you in new and potentially uncomfortable

situations so that you will have the opportunity, in the relatively safe environment of the

classroom, to try out new behaviors and skills. Think of this course as a social skills laboratory

to develop a crucial leadership skill: negotiation and dispute resolution.

Learning objectives:

After completing this course, students will be able to:

Apply concepts from microeconomics (e.g., game theory, Pareto efficiency), psychology

(e.g., cognitive biases), and industrial relations (e.g., integrative bargaining) to analyze

negotiations

Recognize how others perceive their negotiation behaviors and style of interaction

Communicate more effectively, both orally and in writing

Negotiate and resolve disputes with greater confidence and skill than before they enrolled

in this course.

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Course Requirement Due Date Grading Weight

Negotiation Journal, Part 1 Thursday, October 7 1/3

Negotiation Journal, Part 2 Tuesday, November 23 1/3

Take-home test on readings and

lectures

distributed Thursday,

November 4; due Thursday,

November 11

1/3

Class attendance and participation can also substantially affect your grade.

REQUIRED READINGS

Required textbook: Leigh Thompson, The Mind and Heart of the Negotiator, 4th

edition (2008).

In addition, students will be required to purchase a packet of photocopied materials, consisting of

readings that I will distribute on September 2 and negotiation exercises that I will distribute

throughout the semester. The cost of these includes not only photocopying, but also $17.95 in

copyright fees.

NEGOTIATION JOURNAL

You are required to maintain a journal as a vehicle for continuing reflection on your negotiation

experiences over the semester. The journal should have:

1. one entry for each role playing class exercise prior to November 23,

2. one entry about a negotiation or dispute resolution experience outside this class, and

3. an essay reflecting back on your experiences over the whole semester.

Although there is no set minimum or maximum length for the journal entries, 1-2 pages typed

double-spaced per entry would be typical.

The journal entries are not a permanent record of each detail of what happened. I am only

interested in enough detail to understand the situation. The main purpose of each entry should be

to analyze the process and the outcome of the negotiation. Among the questions that you might

address are:

How did the actual process and outcome compare to the predictions of various writings on

negotiation? For example, the photocopied reading by Greenhalgh and Gilkey, “Our Game,

Your Rules,” asserts that men and women begin negotiation with very different cognitive

frames. Did the assertions in this article apply to the men and/or women in this negotiation?

What did you learn about negotiation from the experience and your reflection on it?

What surprised you about your behavior and that of the other party or parties?

Did you and the other party or parties make full use of opportunities for mutual gains? If not,

why not?

How did the history of the situation, the communication process, the distribution of power,

coalitions between parties, time pressures, etc. shape the outcome of the negotiation? Did

you achieve a less favorable outcome for yourself than you might have? If so, why?

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What did you learn about your values, assumptions, perceptions, methods of coping with

stress, and style of interaction? What did you learn about the other party or parties?

If you had the chance to do this negotiation over, what would you do differently?

My focus in grading will be on the quality of insight and reflective thinking embodied in the

journal entries. I also expect correct grammar and spelling. Use concepts and theories from

the readings or lectures when appropriate to analyze what happened in your negotiation.

I will separately distribute two very good journal entries from previous semesters. These samples

should give you a better idea of what I want in your journals.

The journal will be a very personal document. In order to gain full value from the writing, it is

important that you be honest with yourself. To facilitate this, I will keep your journal writing

confidential. In my comments, I may ask if you would be willing to share a particular set of

reflections with the class, but this will be strictly voluntary.

I recommend saving each entry as a separate computer file (e.g. Polynesian.doc or

Disarmament.doc). I also recommend printing out a paper copy of each journal entry as soon as

you finish writing it. That way, you will not lose your previous work if you make some grievous

computer error as you are writing a subsequent entry.

I urge you to write each journal entry soon after the exercise concludes, while you still

remember what happened.

Each journal entry for a role-playing exercise from class should begin with the following

information:

--name of the exercise

--your role in the exercise (for exercises with assigned roles, e.g., “buyer” for The Used

Car)

--name of your teammate or teammates, if any

--names of the persons with whom you (and your teammates, if any) negotiated

--roles of the persons with whom you negotiated

Example of information at the beginning of a journal entry:

Twin Lakes Mining Company

Town council: Bob, Jane, Dave Harris, Mary, and me

Mining company: Ellen, Joe, Dave Manski, Susan, and Vikram

(Note that last names are needed when there are two students in the class with the same first

name.)

The journal will be due in two parts. Part 1 is due in class on Thursday, October 7. Part 2 is due

in class on Tuesday, November 23.

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NEGOTIATION JOURNAL (continued)

Requirements for Journal Part 1:

1. Journal entries for each of the role playing exercises in class from the beginning of the

course through October 5, and

2. One journal entry from a negotiation in which you were involved outside this class (e.g.,

in other classes, in paid jobs, in dealings with merchants, in dealings with antisocial

dormitory neighbors, or in your relationships with friends or family).

Requirements for Journal Part 2:

1. Journal entries for each of the role playing exercises in class from October 7 through

November 18, and

2. A short paper (about 4-5 pages, typed double spaced), reflecting back on your experiences

during the semester and identifying the key themes and lessons that have emerged. This

reflections paper should be based on three sources of data:

(a) Your journal. Examine your entire journal for the semester as though you were a

dispassionate social scientist who has just come across this curious document. Try to

codify the material in your journal, using specific examples from the journal to illustrate

general tendencies.

(b) Your self-assessment responses. On Thursday in the first week of class, you will

complete a negotiation self-assessment. Save your response. Then, in mid-November,

complete this self-assessment again, without looking at the answers that you gave in

August. After you have written down your November answers, compare your November

answers to your August answers. Did your answers change? If so, why?

(c) Feedback from your classmates with whom you negotiated. I encourage, but do not

require, you to provide feedback to your classmates with whom you negotiate in class. I

will set aside class time at least twice during the semester for you to provide written

anonymous comments to your classmates, with the hope that this feedback will help your

classmates improve their negotiation skills. You should also feel free to provide your

classmates with oral comments on an ongoing basis or to give them written copies of

journal entries concerning your negotiations with them. Identify specific behaviors by

your fellow students, and tell them how their behaviors influenced your behaviors or your

feelings. If you are the recipient of such feedback, try to listen to it graciously and accept

it in the constructive spirit in which it was, I hope, intended.

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TAKE-HOME TEST

I will distribute a take-home test in class on Thursday, November 4. The test answers are due in

class the following Thursday, November 11. Please type your answers double-spaced.

The test will focus on the material covered in the assigned readings and in lectures. You may

refer to your notes and your book when you work on the test, but you may not consult any of the

other students in the class or anyone else. If you have completed all of the assigned reading

before the day on which I distribute the test, then you should be able to complete the test in a

reasonable time. (I am aiming for six to eight hours.) If you have not kept up with the reading,

however, you may be in for a frantic experience.

There is no exam during finals week for this course; the take-home exam is the only exam.

CLASS ATTENDANCE AND PARTICIPATION

Because of the highly experiential nature of the course, near perfect attendance is required for the

class sessions on which we have role playing exercises. Each student may miss one role-playing

exercise without penalty. Save this for the day that you get the flu, that you have to attend your

grandmother's funeral, or that you have a crucial job interview in Detroit. Students who miss

more than one role-playing exercise will have their grades reduced by 1/3 grade (e.g., from a 3.7

to a 3.3) for each exercise beyond the first that they miss. You have been warned.

If possible, please give me advance notice that you will be absent for a role-playing exercise; this

notice will help me when I organize the exercise at the beginning of the class.

It is sometimes possible to make arrangements for students to make up a missed exercise outside

of class, doing the exercise with another student who also had to miss class that day. It is

impossible, however, to make up exercises in which the whole class is one group (e.g., Bennett,

Strang & Farris). Finally, even when it is possible to make up a missed exercise outside of class,

you will learn less because you will miss much of the analysis from the debriefing. Both to avoid

the possibility of a grade penalty and to maximize your learning, you should make every effort to

attend all of the role-playing sessions.

After any adjustment is made on the basis of attendance, I will retain the option of a further

(subjective) adjustment on the basis of the quality of participation. Students who are poorly

prepared for a role playing exercise, who do not take their roles seriously, or who are not actively

involved in the exercise may diminish the potential learning from that exercise not only for

themselves, but also for the other person or persons in their group. (Fortunately, I have had few

such students in my negotiation course in past years.) On the other hand, students with

particularly keen insights may make the exercises more valuable both for themselves and for the

others in their group. The subjective adjustment can be as much as 1/3 of a grade either up or

down (e.g., the difference between a 3.3 and a 3.7.) In a large majority of cases, I will make no

subjective grade adjustment.

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ACADEMIC INTEGRITY

Albion College has adopted the following statement on academic integrity: “As an academic

community, Albion College is firmly committed to honor and integrity in the pursuit of

knowledge. Therefore, as a member of this academic community, each student acknowledges

responsibility for his or her actions and commits to the highest standards of integrity. In doing

so, each student makes a covenant with the college not to engage in any form of academic

dishonesty, fraud, cheating, or theft.”

As noted above, you may not consult other students in this class or anyone else about the take-

home exam. Furthermore, I expect you to refrain from making any effort to see the confidential

role-play instructions of students playing other roles in the negotiation exercises.

I leave it to each of you to decide whether to lie to another student with whom you are

negotiating, but you should consider very seriously both your personal ethics and the potential

damage to your ability to win the trust of others in the future.

DISABILITY STATEMENT

If you have a disability and may require accommodations or modifications in class instruction or

course-related activities, please contact the Learning Support Center (LSC) staff who can arrange

for reasonable accommodations for students who provide documentation of their

disability/condition. If you are presently registered with the LSC and have requested

accommodations through the LSC for this semester, please plan to meet with me as early as

possible to discuss the best way to implement these accommodations in this class. The LSC is

located on the third floor of the Seeley Mudd library or call 517-629-0825.

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Tentative Schedule

Week of Day Topic and Reading Assignment

Aug 24 Tues Introduction

Role Play: “Polynesian Coconuts”

Thurs Competition and Cooperation

Role Play: “The Disarmament Exercise”

Reading: text, chapters 1-2

Aug 31 Tues The ABC's of Game Theory and the Prisoner's Dilemma

Reading: text, chapter

Thurs Multiparty Prisoner’s Dilemma

Role Play: “Win As Much As You Can”

Reading: text, chapter 11

Photocopied Reading: Avinash Dixit and Barry Nalebuff, Thinking

Strategically (New York: W.W. Norton, 1991), “Ten Tales of Strategy,”

pages 7-30.

Sep 7 Tues Distributive Bargaining, BATNA’s and Reservation Points


Theories of Negotiation

Photocopied Readings:

Richard Walton and Robert McKersie, A Behavioral Theory of Labor

Negotiations (New York: McGraw-Hill, 1965), “Introduction and

Theoretical Framework,” pages 1-10.

Howard Raiffa, The Art and Science of Negotiation (Cambridge, MA:

Harvard University Press, 1982), “Prologue,” “Some Organizing

Questions,” and “Research Perspectives,” pages 1-25.

H. Peyton Young, “Dividing the Indivisible,” in Richard Zeckhauser, et al.

(eds.), Wise Choices: Decisions, Games, and Negotiations (Boston:

Harvard Business School Press, 1996).

James Sebenius, “Sequencing to Build Coalitions: With Whom Should I

Talk First?” in Zeckhauser, Wise Choices.

Thurs Distributive Bargaining

Reading: text, appendix 4

Role Play: “Summer Internship”

Second Role Play: “The Used Car”

Sep 14 Tues Greg Saltzman Buys a Minivan

Thurs Integrative Bargaining, Pareto Efficiency, and Negotiation Style

Role Play: “El Tek”

Reading: text, chapters 4-5

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Sep 21 Tues Trust, Ethics, and Power

Reading: text, chapters 6-7, Appendix 2

A Brief Introduction to Expected Value Calculations (needed for Jessie

Jumpshot role play next week)

Thurs Unequal Power

Role Play: “Viking Investments”

Photocopied Reading: Robert Mnookin, Scott Peppet, and Andrew Tulumello,

“The Tension between Empathy and Assertiveness,” Negotiation Journal,

Vol. 12, No. 3, July 1996, pp. 217-230.

Sep 28 Tues (1) Use of Agents; (2) Contingent Contracts

Role Play: Jessie Jumpshot

Note: At the end of Tuesday’s class, you will be given some questions about

the Jessie Jumpshot negotiation to analyze prior to Thursday’s class.

Thurs Discussion of Jessie Jumpshot questions; discussion of Jessie Jumpshot video

Cognitive Biases


Oct 5 Tues Gender Issues in Negotiations

Photocopied Readings:

Rosabeth Moss Kanter, Men and Women of the Corporation (New York:

Basic Books, 1977), “Numbers: Minorities and Majorities,” pages

206-242.

Leonard Greenhalgh and Roderick Gilkey, “Our Game, Your Rules:

Developing Effective Negotiation Approaches,” in Linda Moore, ed.,

Not as Far as You Think (Lexington, MA: Lexington Books, 1986).

Deborah Tannen, “The Power of Talk: Who Gets Heard and Why,”

Harvard Business Review, Vol. 73, September-October 1995, pp. 138-

148.

Thurs Environmental Disputes

Role Play: “Twin Lakes Mining Company”

Journal Part 1 due in class, Thursday, October 7

Oct 12 Tues No classes Tuesday, October 12 (fall break)

Thurs Multiple Party Negotiations

Role Play: “The New Truck”


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Oct 19 Tues Group Negotiations

Role Play: “Towers Market”

Thurs Structured Multi-Party Negotiations

Role Play: “Harborco”

Oct 26 Tues Role Play: “The Ultimatum Game”

Reading (unrelated to this role play): text, chapter 10

Thurs Unstructured Multi-Party Negotiations

Role Play: “Bennett, Strang & Farris”

Reading (unrelated to this role play): text, chapter 12

Nov 2 Tues Mediation and Arbitration

Reading: text, Appendix 3

Thurs Competition and Cooperation in Groups

Role Play: “Strategic Decisions at Jaguar”

Take-home test distributed in class, Thursday, November 4

(covers readings and classes through November 4)

Nov 9 Tues Community Conflict: Race and Class Divisions

Role Play: “Elmwood Hospital Dispute”

Thurs Labor Negotiations

Take-home test answers due in class, Thursday, November 11

Nov 16 Tues Discuss Exam

Thurs Cross-Cultural Issues in International Negotiations

Role Play: “Alpha-Beta”

Nov 23 Tues Labor-Management Negotiations

Video: “Final Offer”

Journal Part 2 due in class, Tuesday, November 23

Thurs No classes Thursday, November 25 (Thanksgiving break)

Nov 30 Tues International Negotiation: The Palestinian-Israeli Conflict (lecture 1 of 2)

Thurs International Negotiation: The Palestinian-Israeli Conflict (lecture 2 of 2)

economics and management 376: negotiation and...

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