Recently, I wrote about a new study on fairness in monkeys. (another-study-on-fairness ) “Fairness” seems to be a popular topic as my colleague Linda Bulmash in her One Minute Negotiation Tipspublished by the Los Angeles County Bar, (Volume VI, Number 2, February 2013) (Busmash) takes up the topic of “Defining Fairness in A Negotiation”. In her article, she notes that “fairness” can be defined in several different ways. It is a “loaded” term, to say the least.
As explained in greater detail by Nancy A. Welsh in her article “Perceptions of Fairness in Negotiation”, 87 Marquette Law Review 753 (2004), “fairness” has both a distributive definition and a procedural definition. (Fairness) “Distributive fairness focuses on the criteria that lead people to feel that they have received their fair share of available benefits-i.e., that the outcome of a negotiation or other decision making process is fair.” (Id. at 754.). Not surprisingly, its definition is very subjective but can be distilled into
“….four basic, competing principles or rules- equality, need, generosity, and equity. The equality principleprovides that everyone in a group should share its benefits equally. According to the need principle, “those who need more of a benefit should get more than those who need it less.” The generosity principledecrees that one person’s outcome should not exceed the outcomes achieved by others. Finally, the equity principle ties the distribution of benefits to people’s relative contribution. Those who have contributed more should receive more than those who have contributed less.” ( Id.)
Ms. Bulmash notes that Harvard Business School Professor Max Bazerman has found an additional principle: maintaining the status quo. To resolve a conflict, an organization will resist radical change and instead agree to make a change in the same way or manner as it did in the past- even though it was never “fair” to begin with!
Returning to Ms. Welsh’s article, she notes that as overlays to distributive fairness are the variables of self-interest, social relationships and the interaction between cultural norms and situational needs. (Id. at 755.) The first two- self-interest and social relationships- are very much intertwined. If there is no relationship between the negotiating parties and/or each never expects to negotiate with the other again, each party will have her self-interest uppermost in deciding which of the four principles (need, generosity, equality or equity) should dictate her actions. If the negotiating parties have a negative relationship, each “…will aim to gain more than the other negotiator, even if this requires undertaking a risky strategy.” (Id.)
If, though, the parties have a positive relationship, it suddenly becomes important to each of them that a “fair” outcome is reached:
“Further, positive social relationships influence negotiators’ selection of the particular fair allocation principle that will anchor their negotiations. If a negotiator is dividing a resource with someone else and expects future, positive interactions with that person, the negotiator tends to use the equality principle to define distributive fairness.” (Id. at 756.)
As one can easily surmise, “fair” outcomes are affected by our own self-interest or our “egocentric bias”. Our perception of fairness is affected by the role we play in the negotiation, or as Ms. Welsh phrases it, “
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