Featured Research

from universities, journals, and other organizations

Asking for a precise number during negotiations can give you the upper hand

Date:
June 1, 2013
Source:
Columbia Business School
Summary:
A recently published study on the art of negotiation could help new hires -- and all negotiators -- seal a stronger deal than before.

With so much on the line for job seekers in this difficult economic climate, a lot of new hires might be wondering how -- or whether at all -- to negotiate salary when offered a new position. A recently published study on the art of negotiation by two professors at Columbia Business School could help these new hires -- and all negotiators -- seal a stronger deal than before.

Research conducted by Professors Malia Mason and Daniel Ames and doctoral students Alice Lee and Elizabeth Wiley finds that asking for a specific and precise dollar amount versus a rounded-off dollar amount can give you the upper hand during any negotiation over a quantity.

"What we discovered is there is a big difference in what most people think is a good strategy when negotiating and what research shows is a good strategy," said Professor Mason. "Negotiators should remember that in this case, zero's really do add nothing to the bargaining table."

The research, forthcoming in the Journal of Experimental Social Psychology, looks at the two-way flow of communication between 1,254 fictitious negotiators.

The negotiators were placed in everyday scenarios such as buying jewelry or negotiating the sale of a used car. Some people were asked to make an opening offer using a rounded-off dollar amount, while other people were asked to use a precise dollar amount; let's say for example $5,000 vs. $5,015.

The results showed that overall, people making an offer using a precise dollar amount such as $5,015 versus a rounded-off dollar amount such as $5,000 were perceived to be more informed about the true value of the offer being negotiated. This perception, in turn, led precise-offer recipients to concede more value to their counterpart.

In their negotiation scenarios, the professors concluded the person making a precise offer is successfully giving the illusion they have done their homework.When perceived as better informed, the person on the opposite end believes there is less room to negotiate.

To determine whether people make round offers more often than not, the researchers looked at the real estate market. Research done on Zillow, the online real estate marketplace, showed the overwhelming majority of displayed prices were rounded numbers, and that only two percent of people listed their homes with precise dollar amounts.

"The practical application of these findings -- signaling that you are informed and using a precise number -- can be used in any negotiation situation to imply you've done your homework," Mason concluded.


Story Source:

The above story is based on materials provided by Columbia Business School. Note: Materials may be edited for content and length.


Journal Reference:

  1. Malia F. Mason, Alice J. Lee, Elizabeth A. Wiley, Daniel R. Ames. Precise offers are potent anchors: Conciliatory counteroffers and attributions of knowledge in negotiations. Journal of Experimental Social Psychology, 2013; 49 (4): 759 DOI: 10.1016/j.jesp.2013.02.012

Cite This Page:

Columbia Business School. "Asking for a precise number during negotiations can give you the upper hand." ScienceDaily. ScienceDaily, 1 June 2013. <www.sciencedaily.com/releases/2013/06/130601133931.htm>.
Columbia Business School. (2013, June 1). Asking for a precise number during negotiations can give you the upper hand. ScienceDaily. Retrieved September 23, 2014 from www.sciencedaily.com/releases/2013/06/130601133931.htm
Columbia Business School. "Asking for a precise number during negotiations can give you the upper hand." ScienceDaily. www.sciencedaily.com/releases/2013/06/130601133931.htm (accessed September 23, 2014).

Share This



More Science & Society News

Tuesday, September 23, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Ebola Costs Keep Mounting

Ebola Costs Keep Mounting

Reuters - Business Video Online (Sep. 23, 2014) The WHO has warned up to 20,000 people could be infected with Ebola over the next few weeks. As Sonia Legg reports, the implications for the West African countries suffering from the disease are huge. Video provided by Reuters
Powered by NewsLook.com
Ebola Cases Could Reach 1.4 Million Within 4 Months

Ebola Cases Could Reach 1.4 Million Within 4 Months

Newsy (Sep. 23, 2014) Health officials warn that without further intervention, the number of Ebola cases in Liberia and Sierra Leone could reach 1.4 million by January. Video provided by Newsy
Powered by NewsLook.com
Obama: No Nation Gets Pass on Climate Change

Obama: No Nation Gets Pass on Climate Change

AP (Sep. 23, 2014) In a forceful appeal for international cooperation on limiting carbon pollution, President Barack Obama warned world leaders at the UN Climate Summit on Tuesday that the globe's climate is changing faster than efforts to address it. (Sept. 23) Video provided by AP
Powered by NewsLook.com
Overcrowding Has Public Schools Going Vertical

Overcrowding Has Public Schools Going Vertical

AP (Sep. 23, 2014) Pricey real estate and overcrowding have forced urban and suburban school districts to get creative. In Atlanta and outside Washington, that means converting high rise commercial buildings into vertical learning environments. (Sept. 23) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:

Strange & Offbeat Stories


Science & Society

Business & Industry

Education & Learning

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins