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THE BARGAINING REPUTATION

The way in which a government negotiates and the conditions under which it accepts or rejects an agreement have an important bearing on its bargaining strength in the future. In every diplomatic confrontation, governments are trying not only to affect the terms of agreement under negotiation but also to protect or improve their strength in future negotiations. What they have in mind can best be explained as a reputation. A government acquires a reputation much as an individual does. On the basis of its performance in past negotiations, others will impute to it a diplomatic style, certain motives and objectives, attitudes toward the use of force, a degree of political will, and other attributes of power. Bargaining strength depends not so much on what these attributes really are as on what others believe them to be. Hence the importance of this reputation.

The influence of the bargaining reputation can easily be explained in the context of two opponents trying to influence each other's threefold choice between agreement on the opponent's terms, no-agreement, and further bargaining. If you are the negotiator, you know that your opponent's threefold choice will be governed in part by his anticipations of your reactions. He bases these anticipations on his image of you, concerning such attributes as your attitude toward risk-taking, your tendency to bluff, your evaluation of your own strength and his, your tendency to hold fast to a position, and so forth. Naturally, your opponent will assume a certain continuity in these attributes and base his estimates of them partly on your performance in previous negotiations. Knowing this, you will act in every negotiation not only so as to obtain a favorable outcome at that time but also so as to preserve or improve your negotiating strength in the future. The fact that these two considerations frequently conflict adds an important complication to the negotiating process.

The influence of the bargaining reputation can be paraphrased in the language of game theory: an international negotiation is never a self-contained "game” but is a phase vaguely related to a never-ending "super-game." Although each phase yields its own payoffs, the tactics used in it affect the opponent's calculations in subsequent phases and hence influence subsequent payoffs. The "super-game” comes to an end only under exceptional circumstances: a government whose existence is at stake and which expects no continuity with its successor may contemplate the losing situation (but not the winning one!) as the end of the "super-game.'

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