Negotiation is the process of conferring with others to
reach an agreement. Bargaining occurs when there is a
dispute over the terms involved. A straightforward allocation
of adequate resources would involve negotiation,
but if there is a shortage of time, money, or materials,
then the parties will bargain over the exact distribution
to promote their own best interests. Collective bargaining
Negotiation and Bargaining———1493
is a structured process where a group such as a union
will negotiate with an employer as a single unit about
terms of their employment contract.
The basic conditions for negotiation are that the
parties are voluntary participants and there is a positive
bargaining zone. Thus, there is no negotiation in
mugging at gunpoint or when groceries are offered
at a fixed price in the store and there are sufficient
paying customers that the storekeeper has no incentive
to lower the price. A bargaining zone is a range of
exchange where one side is willing to offer and the
other is willing to accept. If neither side is willing to
extend the zone then there is no room for meaningful
There are several other necessary elements for
negotiations to be successful. Initially, the parties
involved must have the power to settle. Second, all
the parties involved need to be willing to take part in
the negotiation. If critical parties are absent or if one
party is not prepared to bargain in good faith, then
there is little hope for a workable agreement.
Moreover, the parties need to be psychologically
prepared to negotiate; if there is high emotion, inadequate
information, or failure to formulate a negotiation
strategy, then the parties’ negotiations are
unlikely to be productive.
The parties must in some way be mutually dependent
and have the ability to influence each other. Such
influence can be seen as having something the other
party desires or having the means to increase benefits... [continua]
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