Resolving The Empty Core: Trust As A Determinant Of Outcomes In Three-Party Negotiations

Mara Olekalns, Melbourne Business School
Feyona Lau, University of Melbourne
Philip L. Smith, University of Melbourne

Abstract

This research examined how trust affected resource allocation in a 3-party negotiation. Negotiators were presented with an empty core problem in which their theoretical share of resources exceeded the resources available for distribution. We tested which of three components of trust – reliability, predictability and empathy – predicted negotiators’ outcomes. We distinguished between absolute and relative trust. We found that relative trust was a more consistent predictor of individual outcomes than absolute trust and that the most trusted party in a network obtained the highest individual outcomes. This finding highlights the importance of social context in shaping trust judgements. The component of trust that predicted individuals’ outcomes was affected by structural power. High and low power negotiators benefited from conveying empathy (identity-based trust), whereas moderate power negotiators benefited from conveying predictability (knowledge-based trust). Low power parties also benefited from appearing unreliable (low calculus-based trust).