Cooling-Off in Negotiations - Does it Work?

  title={Cooling-Off in Negotiations - Does it Work?},
  author={Joerg Oechssler and Andreas Roider and Patrick W. Schmitz},
  journal={CEPR: Labour Economics (Topic)},
Negotiations frequently end in conflict after one party rejects a final offer. In a large-scale internet experiment, we investigate whether a 24-hour coolingoff period leads to fewer rejections in ultimatum bargaining. We conduct a standard cash treatment and a lottery treatment, where subjects receive lottery tickets for several large prizes - emulating a high-stakes environment. In the lottery treatment, unfair offers are less frequently rejected, and cooling-off significantly reduces the… 

Concession Bargaining

We test experimentally whether dynamic interaction is crucial for concession bargaining. In our complete information bargaining experiments, two parties with asymmetric conflict payoffs try to agree

Power Illusion in Coalitional Bargaining: An Experimental Analysis

In real world bargaining the distribution of seats or voting weights often does not accurately reflect real power. Game-theory predictions are insensitive to nominal differences. We refer to the

Stackelberg in the Lab: The Eect of Group Decision Making and "Cooling-o¤"Periods

The Stackelberg duopoly is a fundamental model of sequential output competition amongst …rms. The equilibrium outcome of the model results in a …rst mover advantage where the …rst-moving …rm produces

Do short-term laboratory experiments provide valid descriptions of long-term economic interactions? A study of Cournot markets

One key problem regarding the external validity of laboratory experiments is their duration: while economic interactions out in the field are often lengthy processes, typical lab experiments only

Cooling off periods in franchise contracts: from consumer protection mechanisms to paternalistic remedies for behavioral biases

The “cooling-off period” has remained a fixture of domestic consumer-protection legislation. Yet, as I argue in this paper, the longevity of these provisions is neither the result of their


We report the results from three experiments embedded in the same overarching design, which extends the Gift Exchange paradigm for the study of worker–employer relationships. We focus on the effect

Do We Need More Time to Give Less? Experimental Evidence from Tunisia

Using a laboratory dictator game in Tunisia, we investigate whether the donation level is influenced by the time allotted to take the giving decision. We found that when participants have more time

Equilibrium Play in Voluntary Ultimatum Games: Beneficence Cannot Be Extorted

Motivated by Adam Smith's proposition that beneficence—like that of non- equilibrium play in the ultimatum game—cannot be extorted by force, this work offers the responder the opportunity to opt out of the game for a mere $1 payoff.

An Experiment on Waiting Time and Punishing Behavior

It is found that waiting reduces the overall probability of destroying and responders destroy more often in response to higher take rates when the waiting time is longer.



Bargaining and Market Behavior in Jerusalem, Ljubljana, Pittsburgh, and Tokyo: An Experimental Study

In an experiment comparing two-person bargaining and multiperson markets in Israel, Japan, the United States, and Yugoslavia, market outcomes converged to equilibrium everywhere, with no

Learning in High Stakes Ultimatum Games: An Experiment in the Slovak Republic

In an ultimatum game experiment, financial incentives were varied by a factor of twenty-five. Consistent with prior results, changes in stakes had only a small effect on play for inexperienced

Fairness in the Mail and Opportunism in the Internet: A Newspaper Experiment on Ultimatum Bargaining

Abstract On 11 May 2001, readers of the Berliner Zeitung were invited to participate in an ultimatum bargaining experiment played in the strategy vector mode: each participant chooses not only how

Fairness versus reason in the ultimatum game.

It is shown that fairness will evolve if the proposer can obtain some information on what deals the responder has accepted in the past, and similarly to the evolution of cooperation, is linked to reputation.

Emotions, Rejections, and Cooling off in the Ultimatum Game

This paper experimentally investigates whether responder behavior in the ultimatum game is related to self-reported emotions. In addition, it is investigated whether responders’ experienced emotions

Raising the Stakes in the Ultimatum Game: Experimental Evidence From Indonesia

Implementing the ultimatum game experimentally in Indonesia makes it possible to raise the stakes to three times the monthly expenditure of the average participant. Contrary to predictions in the

On the Nature of Fair Behavior

This Paper shows that identical offers in an ultimatum game generate systematically different rejection rates depending on the other offers that are available to the proposer. This result casts doubt

A Theory of Fairness, Competition and Cooperation

There is strong evidence that people exploit their bargaining power in competitive markets but not in bilateral bargaining situations. There is also strong evidence that people exploit free-riding