Bachararch
and Lawler's Dependence Theory of Bargaining Power
Power, according to Samuel Bacharach and
Edward Lawler in Bargaining: Power, Tactics, and Outcomes (1981),
is a central feature of bargaining and negotiation. They regard "bargaining"
as a process of managing impressions and manipulating information.
Bacharach and Lawler have developed a provocative and comprehensive theory
of power in bargaining and negotiation.
Assumptions
Bacharach and Lawler's theory involves
the following assumptions:
1. POWER IS THE
ESSENCE OF BARGAINING. It is the pivotal construct
of bargaining. This assumption emphasizes that
a. Power the central organizing
device of a bargainer's reality.
b. Power is multidimensional:
(1) Power
as an outcome
(2) Power
as potential
(3) Power
as tactical action; the use of power.
2. BARGAINING
IS A PROCESS OF TACTICAL ACTION. Tactical action links
potential power and bargaining outcome.
3. BARGAINING
POWER IS SUBJECTIVE POWER. Power in negotiation does not
exist apart from bargainers'perceptions of it (within the bargaining situation
and relationship).
a. Power has an objective
component (e.g., money, status, knowledge, reward). The
subjective component (bargainers' power perceptions and judgments), though,
is
more important to understanding potential power and tactical action.
b. Objective power
influences bargaining through the actual interaction of the
negotiators.
c. Manipulating perceptions
of power is a critical bargaining tactic.
A Dependence Theory of
Power
Based on these assumptions, Bacharach
and Lawler present a "dependence" theory of power. Dependence refers,
generally, to the degree that parties have a stake in the bargaining relationship.
The dependence relationship is not constant or fixed. Negotiators
bargain about the nature of their dependence on one another.
Dimensions of dependence include:
1. ALTERNATIVES
- The extent to which parties have alternatives via which they can gain
similar outcomes.
2. COMMITMENT
- The extent to which a party is committed to outcomes the other bargaining
party controls.
3. Bargaining power reflects (in bargaining
between Party A and Party B):
a. A's alternatives to dealing
with B.
b. B's alternatives to dealing
with A.
c. A's commitment to outcomes
B controls.
d. B's commitment to outcomes
A controls.
4. Bargaining power involves the parties'
comparative dependence.
a. The greater A's alternatives,
the less B's power over A.
b. The fewer A's alternatives,
the greater B's power over A.
c. The greater A's commitment
to outcomes B controls, the greater B's power over A.
d. The less A's commitment
to outcomes B controls, the less B's power over A.
5. Power is influenced by manipulating
perceptions of alternatives and commitment.
6. Persuasive argument is a primary way
of manipulating perceptions of alternatives and commitment.
Three Forms of Power
Bacharach and Lawler identify three forms
of bargaining power.
1. Absolute power
- power of an individual irrespective of the other party's power.
A's absolute power is determined by B's alternatives and commitment.
2. Relative power
- the dependence of one party compared to the dependence of the other party.
The ratio of A's dependence on B to B's dependence on A.
3. Total power
- the sum of the parties' dependence upon one another.