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The effect of cost information on buyer-supplier negotiations in different power settings.

By Alexandra Van den Abbeele, Filip Roodhooft and Luk Warlop

Abstract

We investigate the influence of cost information on buyer-supplier negotiations in different power settings. Based on exchange theory, we expect that buyers with detailed cost information and less power than their opponent may try to (re)gain control over their own outcomes by sharing information. The results of our experiment indicate that the performance disadvantage of less powerful buyers is less pronounced when the buyer has detailed cost information and that this result can be explained by the buyer's negotiation behavior.Behavior; Control; Cost; Exchange; Information; Negotiations;

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