Bounded Awareness: Focusing Failures in Negotiation

FRONTIERS OF SOCIAL PSYCHOLOGY: NEGOTIATIONS, L. Thompson, ed., Psychological Press, 2005

Harvard PON Working Paper No. 04-124; HBS Working Paper 04-062

38 Pages Posted: 30 Nov 2004  

Dolly Chugh

New York University (NYU) - Leonard N. Stern School of Business; New York University (NYU) - Department of Management and Organizational Behavior

Max H. Bazerman

Harvard Business School - Negotiations, Organizations and Markets Unit

Date Written: October 2004

Abstract

Recent reviews have documented a shift over the last 25 years in the study of negotiation toward the decision-making process of the negotiator (Bazerman, Curhan, & Moore, 2000; Bazerman, Curhan, Moore, & Valley, 2000; Neale & Fragale, this volume; Neuberg & Fiske, 1987; Thompson & Fox, 2000). The decision perspective to negotiation has highlighted important ways in which negotiator judgment falls systematically short of rationality. This paper is broadly compatible with this perspective, but highlights an underexplored aspect of the judgmental failure - how decision-makers and negotiators systematically ignore valuable information that is readily available.

Recent research in social and cognitive psychology has documented the ability of the human mind to focus on specific information while failing to incorporate other information that is readily available and relevant. We use this literature to integrate what we know about this failure, and organize this knowledge under our organizing construct of "bounded awareness". We define bounded awareness as an individual's failure to "see" and use accessible and perceivable information while "seeing" and using other equally accessible and perceivable information.

We believe that bounded awareness is relevant to both individual decision making and negotiation. Thus, after reviewing the decision perspective to negotiation, we develop the individual decision making aspect of bounded awareness before identifying the specific application of the concept to negotiation. We conclude by suggesting future research directions on bounded awareness in negotiation.

Keywords: negotiation, focusing, decision making, judgment, cognition

Suggested Citation

Chugh, Dolly and Bazerman, Max H., Bounded Awareness: Focusing Failures in Negotiation (October 2004). FRONTIERS OF SOCIAL PSYCHOLOGY: NEGOTIATIONS, L. Thompson, ed., Psychological Press, 2005; Harvard PON Working Paper No. 04-124; HBS Working Paper 04-062. Available at SSRN: https://ssrn.com/abstract=627482

Dolly Chugh

New York University (NYU) - Leonard N. Stern School of Business ( email )

44 West 4th Street
New York, NY NY 10012
United States

New York University (NYU) - Department of Management and Organizational Behavior ( email )

44 West 4th Street
New York, NY 10012
United States

Max H. Bazerman (Contact Author)

Harvard Business School - Negotiations, Organizations and Markets Unit ( email )

Soldiers Field
Boston, MA 02163
United States
617-495-6429 (Phone)
617-496-4191 (Fax)

HOME PAGE: http://www.people.hbs.edu/mbazerman

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