When threats and encouragements are effective in bargaining: The case of credit collectors

Abstract

We hypothesise that the effectiveness of threats and encouragements is contingent on the intended recipient's level of negative affect, as evidenced by his/her negative affective display. Therefore, bargainers can be more effective if, as they make offers, they condition any threats or encouragements on the recipient's affective display. We test this hypothesis using 5561 verbal exchanges that occurred during 192 telephone conversations between credit collectors and debtors. Collectors were most effective in motivating debtors to discuss terms to resolve their debt if they: (1) threatened recipients who were nonresponsive and did not show any negative affect; and (2) encouraged recipients who displayed negative affect. This result suggests that making threats and encouragements contingent on a recipient's displays of negative affect may be an important but frequently overlooked component of bargaining.

Acknowledgments

The work described in this paper was supported by the Citicorp Behavioral Sciences Research Council, 112 East 64th street, New York. We wish to acknowledge their generous support and thank them.

 The diligence of several research assistants made important contributions to this paper. They are Allyson Davis, Marion Davis, Shana Hunter, Katy Lin, and Kyle McNamara. Additionally, we wish to acknowledge the contributions of several faculty colleagues who helped us with references or were kind enough to critique early drafts of the paper. They are Christina Brown, Jane Dutton, Phoebe Ellsworth, Thomas Finholt, Richard Gonzalez, Susan Murphy, Judith Olson, David C. Plaut, Anat Rafaeli, Laurie R. Weingart, J. Frank Yates, and colleagues at Stanford's Center for Work, Technology and Organization, particularly Stephen Barley and Robert Sutton.

Notes

¹Control variable results are discussed in the text but are omitted from Table 2 for ease of presentation.