 
PODCAST: Culture and Bargaining: A New Perspective on What
Really Matters at the Multi-Cultural Negotiating TableBusiness
people around the world increasingly find themselves negotiating
with people from other countries and cultures. Scholars have
been divided on the effects of a person’s culture on the negotiation
process. One school of thought suggests that culture is always
important and always influences bargaining outcomes. The second
school takes the other extreme—that culture never matters and
is irrelevant. Recent research by Joydeep Srivastava, associate
professor of marketing, shows that neither view is quite correct.
“Culture matters, but it interacts with bargaining outcomes
in a dynamic way. Some bargaining situations will evoke universal
human reactions, whereas some may evoke culture-based responses,”
says Srivastava.
Joydeep Srivastava, associate professor of marketing, used
undergraduate university students in the U.S. and Korea to test
whether culture affects the outcome in bargaining situations.
The study was conducted simultaneously in both countries. Study
participants were told that they were randomly selected to receive
offers from another student, who proposed dividing a given amount
of money between them.
Srivastava found that as long as the context or situation
is not made clear, people from both the U.S. and Korea tend
to attribute the cause of a particular behavior to an individual
or personality. However, once the context is made clear, the
Koreans tended to discount the individual or personality-based
explanations in favor of contextual or situation-based explanations.
Srivastava’s study demonstrates how a person’s cultural background
may play a role in their perceptions during a bargaining situation.
Western cultures, such as those of North American and Europe,
are more focused on the individual. Because of this pervasive
focus on the individual, in bargaining situations Westerners
are more likely to attribute the cause of a particular behavior
to an individual or personality. For example, a Westerner may
think, “She is offering me such a small slice of the pie because
she wants to have a bigger piece of the pie than me.”
On the other hand, Eastern cultures such as those of Asia
and the Near East tend to be more collectivist; the society
focuses less on the role of individuals and more on the role
of the group. This makes people from Asian cultures more likely
to attribute the cause of a particular behavior to the situation
or the context rather than the individual: “She is offering
me such a small slice of the pie because the pie is small, or
maybe she has to share her slice with several other people.”
Another noteworthy result to emerge from the study was the
effect of the “group” on bargaining outcomes. While the Americans
tended to remain relatively unaffected by whether the person
making the offer was making it solely on behalf of herself or
whether she was representing a group, the Koreans were sensitive
to this change and tended to discount a personality-based explanation
in favor of a group-based one. If told that that the person
making the low offer was representing the interests of his or
her group, then the Koreans tended to be more accepting of the
offer.
“When negotiating with your global counterparts,” says Srivastava,
“try and put yourself in the other person’s shoes. Do not focus
on any one piece of information, but instead consider the entire
gamut of possibilities. Similarly, be sensitive to whether your
bargaining counterpart is a part of a group or is only representing
herself.”
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