Shrewd Bargaining on the Moral Frontier: Toward a Theory of Morality in Practice

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Date
1991Author
Dees, J. Gregory
Cramton, Peter
Citation
"Shrewd Bargaining on the Moral Frontier: Toward a Theory of Morality in Practice," (with J. Gregory Dees) Business Ethics Quarterly, 1, 135-167, 1991.
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From a traditional moral point of view, business practitioners often seem overly concerned about
the behavior of their peers in deciding how they ought to act. We propose to account for this concern by
introducing a mutual trust perspective, where moral obligations are grounded in a sense of trust that others
will abide by the same rules. When grounds for trust are absent, the obligation is weakened. We illustrate this
perspective by examining the widespread ambivalence with regard to deception about one’s settlement
preferences in negotiation. On an abstract level, such deception generally seems undesirable, though in
many individual cases it is condoned, even admired as shrewd bargaining. Because of the difficulty in
verifying someone’s settlement preferences, it is hard to establish a basis for trusting the revelations of the
other party, especially in competitive negotiations with relative strangers.