Initiating Negotiations: The Role of Machiavellianism, Risk Propensity, and Bargaining Power

Initiation is an often-overlooked yet essential stage of the negotiation process. This study examined the effects of two measures of personality—Machiavellianism and risk propensity—and relative bargaining power (as based on multiple situational factors) on three phases of the initiation process—engaging a counterpart, making a request, and optimizing the request. Using a multi-scenario approach, one hundred fifteen participants indicated their initiation preferences for three distinct negotiations. The results of repeated measures ANOVAs indicate that bargaining power influences an individual’s decision to initiate negotiations. In addition, those high in Machiavellianism choose to initiate negotiations even when relative bargaining power is low, whereas those high in risk propensity tend to optimize their requests. The implications of these findings for practitioners and future research are discussed.     

The Greek Debt Crisis: Likely Causes,Mechanics and Outcomes

We use insights from the literature on currency crises to offer an analytical treatment of the crisis in the market for Greek government bonds. We argue that the crisis itself and its escalating nature are very likely to be the result of: (i) steady deterioration of Greek macroeconomic fundamentals over 2001–09 to levels inconsistent with long‐term EMU participation; and (ii) a double shift in markets’ expectations, from a regime of credible commitment to future EMU participation under an implicit EMU/German guarantee of Greek fiscal liabilities, to a regime of non‐credible EMU commitment without fiscal guarantees, respectively occurring in November 2009 and February/March 2010. We argue that the risk of contagion to other periphery EMU countries is significant; and that without extensive structural reforms, the sustainability of the EMU is in question.     

Fifteen Theses on Classroom Teaching

The Southern Economic Association initiated a lecture series on teaching to be presented at its annual meeting. This paper, given on November 24, 2000, was the first such lecture. The editor invited the author to publish the lecture in Southern Economic Journal. Portions of the paper are the fruits of the author's more than 30 years of experience teaching economics. Parts of the paper are based on writings regarding pedagogy outside the discipline of economics. The paper puts forward 15 theses about teaching economics in the classroom. The theses range from propositions about why economics is a particularly difficult subject to teach to suggestions about how the classroom teaching of economics can be improved.     

Firms as knowledge repositories

One reason firms exist is to serve as knowledge repositories. Firms compete against other firms and need profits to survive. Firms must be entrepreneurial to discover and act on profit opportunities. Knowledge required to spot profit opportunities is disbursed among economic actors and often is tacit knowledge that can only be obtained by those in close proximity. This gives rise to agglomeration economies, which can be leveraged within firms. In a competitive economy people have an incentive to keep knowledge from people in other firms, but to share it with those in their firm. One role of the firm is to act as a repository of knowledge for those within the firm’s boundaries, and to lower the cost of obtaining knowledge about profit opportunities. Entrepreneurs need firms to contain and capture the profits from their innovations.