Negotiation constraints in the risk-taking domain: Effects of being observed by partners of higher or lower status

Abstract

This study examined the effects of status held in a reference group and of prior issue commitment on the risky shift and other negotiation outcomes under conditions where accountability to the reference group during negotiation had been enhanced by having high and low status members observe each other. Following assessment of individual risk preferences on the choice-dilemmas task, subjects (eight at a time) were constituted as four leader-subordinate dyads and told to reach joint decisions on half of the choice-dilemmas items. Recombination as all-leader and all-subordinate groups followed. For half of each of these combinations, leaders were negotiators and subordinates were observers; role assignments were reversed for the other half. The negotiators' task was to achieve a consensus on all of the choicedilemmas items-both those with prior dyadic decisions and those without. It was found that subordinate negotiators, relative to leader negotiators, consulted more with their former dyadic partner and more often failed to achieve consensus (deadlock). Subordinate observers advocated higher risk levels than their leader negotiators, whereas subordinate negotiators and leader observers did not differ in risk preferences. Prior issue commitment increased the difficulty of a negotiated agreement and decreased decision satisfaction. On the whole, the presence of observers seemed to increase "loss of face" motivation in leaders and fears of sanction for deviation in subordinates.