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“When your anchor sinks your boat”: A replication and extension study

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  • Jiang, Cheng-Ming
  • Ma, Jia-Tao

Abstract

Most of the literature on behavioral decision-making suggests the presence of a first-mover advantage in negotiations, and this is based on the anchoring heuristic. Maaravi and Levy (2017) recently demonstrated a second-mover advantage in distributive situations, in which one party has information about the market value while the other does not. Because this finding contradicts most of the previous literature, we replicated their Studies 3 and 4, in which the seller had information about the market value while the buyer did not. Our Study 1 asked both the seller and the buyer to move first and provide their offer, and our Study 2 asked participants to role-play actual negotiations. The second-mover advantage suggested by Maaravi and Levy was replicated. We also found that these results were most likely to occur when the buyer who was not knowledgeable about the market price, and expected a price higher than the actual market price. However, when the unknowledgeable buyer expected a lower price than the actual market price, it was advantageous to the knowledgeable seller to move first in the negotiations, otherwise an impasse was more likely to occur.

Suggested Citation

  • Jiang, Cheng-Ming & Ma, Jia-Tao, 2019. "“When your anchor sinks your boat”: A replication and extension study," Journal of Economic Psychology, Elsevier, vol. 75(PA).
    • Handle: RePEc:eee:joepsy:v:75:y:2019:i:pa:s0167487018302642
    DOI: 10.1016/j.joep.2019.01.001
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    References listed on IDEAS

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    1. Ashleigh Shelby Rosette & Shirli Kopelman & JeAnna Lanza Abbott, 2014. "Good Grief! Anxiety Sours the Economic Benefits of First Offers," Group Decision and Negotiation, Springer, vol. 23(3), pages 629-647, May.
    2. repec:cup:judgdm:v:9:y:2014:i:6:p:548-557 is not listed on IDEAS
    3. repec:cup:judgdm:v:12:y:2017:i:5:p:420-429 is not listed on IDEAS
    4. Furnham, Adrian & Boo, Hua Chu, 2011. "A literature review of the anchoring effect," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(1), pages 35-42, February.
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    Cited by:

    1. Lei Zhou & Nan Liu & Ya-Qiong Liao & Ai-Mei Li, 2021. "Risky choice framing with various problem descriptions: A replication and extension study," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 16(2), pages 394-421, March.
    2. Vrânceanu Diana-Maria & Țuclea Claudia-Elena & Țigu Gabriela, 2020. "Price search behaviour in digital markets – A perspective from Romania," Management & Marketing, Sciendo, vol. 15(2), pages 219-235, June.
    3. repec:cup:judgdm:v:16:y:2021:i:2:p:394-421 is not listed on IDEAS

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