University of North Carolina at Chapel Hill
(c) Evelyn Daniel
INLS 131-001

NEGOTIATION SIMULATION

Objective: To form a coalition with another team, in order to divide a stake. The coalition must also decide on a way of dividing the stake so as to satisfy both parties.

Situation: A state agency has announced that it will provide a substantial incentive to any two groups who can reach agreement on ways to improve the delivery of information services to citizens of the state by cooperating. Three groups have been invited to participate as teams in negotiating for this stake: a group of academic library directors who represent the major colleges and universities in the state; a group of computing center directors from these same universities; and a group of public library directors who represent the major public library systems in the state.

The Stake: Each team has unequal resources and different coalitions will receive different payoffs. The following table shows the payoff possibilities:

Academic libraries and computer centers will receive a stake of $600,000.

Public libraries and computer centers will receive a stake of $475,000.

Public libraries and academic libraries will receive a stake of $350,000.

The Strategy: Each team will meet separately to develop a strategy before the negotiations. Each team must also select a negotiator (the spokesperson).

Rules for Negotiation:

1. All members on a team may be present for negotiations; however, only the negotiator may speak. Notes may be passed to negotiators, if desired.
2. A team may change its negotiator between sessions.
3. Only one formal coalition is permitted. At the termination of the game, the stake will be allocated only if a formal coalition has been formed. If no coalition is reached, no funds are allocated.
4. The team not in negotiations -- that is, while the other two teams are negotiating -- must leave the negotiation room.
5. Negotiations will be conducted in the following fixed order and for the following fixed periods of time:

Time	Negotiating Teams
Round 1
12:55	Academic libraries & Computing centers
1:00	Public libraries & Computing centers
1:05	Academic libraries & Public libraries
Round 2
1:25	Academic libraries & Computing centers
1:30	Public libraries & Computing centers
1:35	Academic libraries & Public libraries
(Round 3 continued on 10/24)

Formal Coalitions: A valid formal coalition will be recognized by the instructor only if:

• neither of the two teams receive the same amount of money, and
• neither of the two teams receives zero.

After negotiations, all three teams have the opportunity to submit a written statement in the following form:

Team X has a coalition with Team Y, whereby Team X gets $xxx,xxx and Team Y gets $xxx,xxx.

When the same written statement is received from two teams, a valid formal coalition has been formed.