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Essay / Difference between integrative negotiation and...
The most Sia would be willing to pay is $12,000 and the minimum Mike would be willing to accept is $10,000. A deal, if reached, will create an integrative value of $2,000 relative to no deal, because Sia values the car unilaterally at $2,000 more than Mike. How that $2,000 is divided between them, whether, say, the agreed price is $10,000, $11,000, or $12,000, is a matter of distributive bargaining: any gain for Sia means pain for Mike, and vice versa. So it's fair to describe this as generating $2,000 of distributive value, distributed in accordance with distributive negotiation skills. On the other hand, what if Mike was an exceptional mechanic and enjoyed spelunking in his free time? Sia, on the other hand, can't fix anything and he hates having to take his car to unfamiliar mechanic shops because he fears they will take advantage of him. These details suggest that more integrative value could be created by the sale of the car if Mike guaranteed to repair any broken items for 9 months after the transaction. Suppose, for example, that this would cause Sia's maximum price to increase to $12,500, while Mike's minimum price would only increase to $10,200. Any agreement incorporating the repair agreement would be collaborative because it would generate more integrative value than the parties could obtain through the sale of the car alone. The extra $300 can be explained by the value that can be created by the integrative negotiation skills of the negotiators. “Furthermore, positive emotions make parties less conflictual and more optimistic about the future, which, in turn, increases the chances that they will seek multiple alternatives and find a better integrative – win-win agreement..