The Dissatisfaction of Having Your First Offer Accepted: The Role of Counterfactual Thinking in Negotiations
In this article, the authors explore the role of individuals’ counterfactual thoughts in determining their satisfaction with negotiated outcomes. When negotiators’ first offers are immediately accepted, negotiators are more likely to generate counterfactual thoughts about how they could have done better and therefore are less likely to be satisfied with the agreement than are negotiators whose offers are not accepted immediately. This reduction in satisfaction emerged even when the objective outcomes of negotiators whose first offers were immediately accepted were equal to or better than the outcomes of negotiators whose first offers were not immediately accepted. Evidence for a disconnect between objective outcomes and evaluations emerged in two scenario experiments and a simulated negotiation. The final experiment explored the functional and dysfunctional consequences of counterfactual activation following the immediate acceptance of first offers. Upward counterfactual thoughts were positively related to the amount of preparation for a subsequent negotiation; on the other hand, upward counterfactual thoughts were negatively correlated with the likelihood of making future first offers.