Artifacts in the Siegel-Fouraker Study of Bargaining and Group Decision Making

Siegel and Fouraker (1960) hypothesize and purport to show experimentally that players in bilateral monopoly will tend toward contracts at the Paretian optimum quantity (P.O.) under conditions of incomplete information (players know only their own payoff functions), even though the theory implicitly assumes complete information (both players know both functions). Their results contain artifacts which severely limit the generality of any inferences that might be drawn from them. The theory prediction that players will tend toward P.O. must be based on the explicit, not implicit, assumption of complete information. In this paper it is demonstrated that under conditions of incomplete information it is very likely that players will tend toward contracts at the P.O. only when it can be assumed that they meet the very restrictive condition of behaving like perfect competitors. Also, in an experiment measuring the degree to which players did in fact bid along their marginal functions, some 48% of the variance in behavior was explained by this model.

Organizational Joint Problem-Solving

To carry out its day-to-day activities an organization will establish an organizational servomechanism. On the other hand, planning and problem-solving must be dealt with differently. Traditional methods, characterized here as the authority approach and the group incremental approach, have significant limitations. On the other hand organizations can and do effectively solve novel and complex tasks by organisational joint problem-solving. This approach is characterized in this paper by a set of propositions formulated to describe how authority and responsibility are distributed and how search and coordination are facilitated. This is done through: the linkage of a set of organizational centers around a mission assignment, the initial search at the overall task level, the search within task components, the broadcast of actions and task laws to all or many centers, the identification and resolution of inconsistencies between components and the conduct of joint search, and the iteration on these steps until an overall consistent set of actions has been established. Where the conditions (goal orientation, participant skill, communication facilities) for organizational joint problem-solving are not initially met, steps can be taken to aid and encourage the participants to use the procedures.