In 2015, the government of Greece approached the European Union regarding a new bailout package by requesting a six-month loan extension. The request was rejected within five hours. Four months later, Greece offered new budget proposals in return for an extended bailout package. This time, the proposal led to agreement.
The anecdote begs the question, Do negotiators respond more positively to offers than to requests? Across five experiments, researcher Johann M. Majer of Leuphana University and his colleagues found that opening proposals had an anchoring effect on the talks that followed only when participants framed their proposals as offers—that is, as a gain for their counterpart. When, by contrast, participants framed their opening proposal as a request—that is, as a loss to their counterpart—the anchoring effect was eliminated or even reversed, to the counterpart’s advantage.
The results can be explained by the phenomenon of loss aversion, or the fact that we find losses to be more painful than we find equivalent gains pleasurable. To avoid such pain, we are highly motivated to avoid losses.
The study results offer both offensive and defensive advice to negotiators. First, you are likely to get a better deal when you state your initial proposal in terms of what your counterpart would gain (as an offer) rather than lose. Second, when considering a counterpart’s initial proposal, be aware that you are likely to be swayed by how it is framed. If presented with an offer, try restating it in your mind as a loss rather than as a gain. Examining proposals from a different angle will help you avoid being anchored and making unnecessary or unwarranted concessions.
“Open to Offers, but Resisting Requests: How the Framing of Anchors Affects Motivation and Negotiated Outcomes,” by Johann M. Majer, Roman Trötschel, Adam D. Galinsky, and David D. Loschelder. Journal of Personality and Social Psychology, 2019.
