Journal of Applied Psychology Copyright 2003 by the American Psychological Association, Inc.
2003, Vol. 88, No. 1, 113 120 0021-9010/03/$12.00 DOI: 10.1037/0021-9010.88.1.113
Online Bargaining and Interpersonal Trust
Charles E. Naquin Gaylen D. Paulson
University of Notre Dame University of Texas at Austin
The presented study explores the effect of interacting over the Internet on interpersonal trust when
bargaining online. Relative to face-to-face negotiations, online negotiations were characterized by (a)
lower levels of pre-negotiation trust and (b) lower levels of post-negotiation trust. The reduced levels of
pre-negotiation trust in online negotiations (i.e., before any interaction took place) demonstrate that
negotiators bring different expectations to the electronic bargaining table than to face-to-face negotia-
tions. These negative perceptions of trust were found to mediate another aspect of the relationship,
namely, desired future interaction. Those who negotiated online reported less desire for future interac-
tions with the other party. Online negotiators also were less satisfied with their outcome and less
confident in the quality of their performance, despite the absence of observable differences in economic
outcome quality.
The Internet has significantly influenced the ways in which outcome quality (Barsness & Tenbrunsel, 1998; Rangaswamy &
people communicate and exchange information both within and Shell, 1997), time on task (Hiltz, Johnson, & Turoff, 1986; Kiesler
between organizations (Katsh & Rifkin, 2001; Kiesler & Sproull, & Sproull, 1992), and the tone of the process (Sproull & Kiesler,
1992). It has been estimated that approximately 80% of business 1991).
organizations now rely on electronic messaging (e.g., e-mail) as a
One common thread in the electronic communication literature
critical means of communication for everyday operations (Overly,
is that messages sent via e-mail are, in their current text-based
1999). For example, at Intel (the popular computer chip manufac- format, lacking when it comes to conveying certain types of
turer) employees reportedly spend an average of 2.5 hr per day
information (Kiesler, 1986; Trevino, Daft, & Lengel, 1990). Spe-
interacting via e-mail, generating over 3 million messages per day
cifically, in the absence of nonverbal cues, e-mail users may find
(Overholt, 2001). On a broad level, it is clear that with increasing
it challenging (though not impossible) to send and receive affec-
globalization and the emergence of  virtual workplaces and rap-
tive or relational information, particularly in new relationships
idly changing economic landscapes, e-mail communication repre-
(Walther, 1995; Walther & Burgoon, 1992). In e-mail negotia-
sents an indispensable business and managerial tool.
tions, these problems might become evident as negotiators attempt
How do these changing modes of communication affect orga-
to establish a working relationship and to build the trust that is
nizations and their members? Recognizing that managers spend a
often considered necessary to create an efficient and satisfying
good deal of their time negotiating and dealing with conflicts, it
agreement (Carnevale & Probst, 1997; Kramer & Tyler, 1996;
comes as no surprise that practitioners and scholars alike have
Purdy, Nye, & Balakrishnan, 2000). Indeed, trust is often cited as
sought to explore the ramifications of using the Internet when
one of the critical hurdles to overcome in online negotiations
crafting deals and resolving disputes (see Katsh & Rifkin, 2001;
(Katsh & Rifkin, 2001; Keen, Ballance, Chan, & Schrump, 2000)
Landry, 2000; McKersie & Fonstad, 1997; Thompson, 2001).
and in online communication in general (e.g., Duarte & Snyder,
Conferences and workshops devoted to negotiating and resolving
1999; Keen et al., 2000; Overly, 1999; Rosenoer, Armstrong, &
disputes in the online context have been sponsored by such orga-
Gates, 1999). International consulting firms such as Ernst &
nizations as the Federal Trade Commission, the U.S. Department
Young and Deloitte & Touche now offer expert advice in the
of Commerce, and the European Union (Katsh & Rifkin, 2001).
development of trust within online settings. Academic research has
From a more scholarly perspective, online negotiations have been
also begun to focus on ways negotiators might overcome the
compared with traditional face-to-face interactions in such areas as
challenges associated with the online context (see Moore,
Kurtzberg, Thompson, & Morris, 1999; Morris, Nadler, Kurtzberg,
& Thompson, 1999), with the goal of enabling users to reap the
Charles E. Naquin, Mendoza College of Business, University of Notre
benefits offered by the efficiency of the medium (i.e., overcoming
Dame; Gaylen D. Paulson, McCombs School of Business, University of
distance and time restrictions) while minimizing the potential
Texas at Austin.
costs.
Portions of this research were presented at the annual conference of the
The present research seeks to extend the understanding of (a)
International Association of Conflict Management, Cergy, France, June
negotiations and (b) the social psychological consequences of
2001. We are indebted to Michael Roloff, James Schmidtke, and Trexler
interacting via the Internet by empirically examining how negoti-
Proffitt for their assistance at various stages of this project.
ating online influences interpersonal trust. Much of the theory and
Correspondence concerning this article should be addressed to Charles
research on negotiations have focused on economic outcomes, and
E. Naquin, Mendoza College of Business, University of Notre Dame, Notre
Dame, Indiana 46556. E-mail: [e-mail] only recently have studies begun to explore the more relational or
113
NAQUIN AND PAULSON
114
social aspects of the negotiation process. This study provides in terms of salient group memberships, such as organizational
further insight into these latter elements, which can be critical for affiliation, religion, shared interests, and so forth. Such a shared
long-term relationships. To do so, we first explore theory and sense of identity among negotiators may promote a deeper under-
research regarding trust on a general level and then move to standing of the other individual s thoughts and actions and thereby
consider variations that derive from the online environment. enhance perceived predictability. In addition, shared identity can
create a sense of empathy and concern for the outcomes of the
other. In essence, a shared sense of identity yields a more trusting
Perspectives on Trust in Negotiations
relationship (Lewicki & Wiethoff, 2000; Tyler & Kramer, 1996).
In recent years, scholars have begun to give more attention to In both deterrence- and identification-based trust, negotiators
the social and relational forces at work within negotiations (e.g., seek to eliminate or minimize levels of uncertainty. Although high
Kramer & Messick, 1995; Oliver, Balakrishnan, & Barry, 1994; levels of trust may be hard to attain, attempting to do so from a
Thompson, 2001), with interpersonal trust often cited as a central distance such as over the Internet may be especially challeng-
component to promoting cooperation and goodwill (Mayer, Davis, ing. We now turn our attention to these challenges.
& Schoorman, 1995; McAllister, 1995). Whereas its importance is
frequently noted, trust has historically proved to be an elusive
Trust and the Online Environment
construct with multiple interpretations (Lewicki, McAllister, &
Bies, 1998).
There is a growing stream of research examining the effects of
In this article, we adopt the cross-disciplinary view of trust
Internet-based communication, such as e-mail, on social interac-
provided by Rousseau, Sitkin, Burt, and Camerer (1998), who
tion and decision making. Because of its almost exclusive reliance
defined trust as  a psychological state comprising the intention to
on text-based messaging, the current e-mail system constitutes a
accept vulnerability based upon positive expectations of the inten-
fairly  lean form of media, with important cues rendered unavail-
tions or behaviors of another (p. 395). From this perspective, trust
able for senders and receivers (Daft, 1984; Trevino et al., 1990).
becomes most poignant when there exists potential for significant
Negotiators in these contexts must overcome significant limita-
loss on the part of the one who is trusting. Any benefits of
tions not faced by those interacting in a traditional face-to-face
exhibiting trust in a negotiation (e.g., cooperating) must therefore
setting.
be weighed against the potential risk for exploitation or loss
In particular, whereas e-mail provides an excellent means for
(Deutsch, 1958; Tyler & Kramer, 1996). As such, significant time
conveying information and task-based content, it is not optimal for
and energy may go into assessing the trustworthiness of negotia-
conveying relational messages. Indeed, relational information may
tion opponents. In addition, persons may also spend time and
be most efficiently conveyed via nonverbal channels (i.e., those
energy toward encouraging others to place trust in them.
not translatable into text), with verbal-based channels serving as an
Scholars have long recognized that there may be many reasons
uncomfortable alternative (Watzlavick, Beavin, & Jackson, 1967).
people choose to trust one another (Deutsch, 1973). Building from
Given that judgments of trust are often viewed, at least in part, as
work in organizational relationship development, Lewicki and
relational in nature (Lewicki & Bunker, 1995; Shapiro et al.,
Wiethoff (2000) suggested that there are two primary routes to
1992), making judgments regarding trust exclusively by way of a
trust development (see also Lewicki & Bunker, 1995, 1996; Sha-
text-based channel may feel awkward and constrained. Though
piro, Sheppard, & Cheraskin, 1992): one that is contextually based
negotiators may attempt to overcome the relational limitations of
and another that is more relationally based. In  deterrence-based
this text-based channel (see Thompson, 2001), efforts here may be
trust (also referred to as  calculus-based trust), negotiators essen-
difficult or inappropriate within certain organizational settings
tially engage in a contextual risk analysis of sorts when determin-
(e.g., use of typed symbols to represent an emotional state, com-
ing whether to trust the other party. This analysis is typically
monly referred to as  emoticons ). Thus, we predict that negoti-
rooted in the extent to which one has the ability to punish or deter
ators who exclusively communicate over the Internet via e-mail
the undesirable behaviors that constitute trust violations (Butler &
will be less trusting of others than those who interact face-to-face
Cantrell, 1984; Lewicki & Bunker, 1996; Rempel & Holmes,
as well.
1986; Ring & Van de Ven, 1992; Shapiro et al., 1992; Williamson,
1993). For example, if a negotiator can impact his or her oppo-
Hypothesis 1: Negotiators who bargain online will exhibit
nent s reputation or social viability, exploitation by the other party
lower levels of trust than those who interact face-to-face.
may be perceived as less likely to occur. Trustworthy behavior,
therefore, can be reliably predicted to the extent that it represents Indeed, past research lends support to the first hypothesis re-
the most rational choice for the opponent in pursuit of his or her garding trust. Specifically, persons interacting at a distance report
own self-interest. As such, deterrence-based trust incorporates a lower levels of trust following a negotiation (Fortune & Brodt,
contextual analysis whereby negotiators assess, and perhaps ma- 2000; Moore et al., 1999). However, much of the prior research
nipulate, external pressures guiding behavioral choices. and theory has focused on trust as being primarily reactive, such
The second route to establishing trust, termed  identification- that the process of interacting serves as the means by which trust
based trust, is more relationally based and extends beyond that differences are created. In contrast, we argue that negotiators
which can be explained by a contextual analysis. The foundation actually have a more proactive approach when assessing trust in
for this perspective is consistent with social identity theory (Tajfel, online negotiations and that it is these initial expectations (i.e.,
1978; Tajfel & Turner, 1981), which emphasizes the perception of pre-negotiation) that may influence the relationship between par-
oneness with or belongingness to another. Research in social ties. We base this prediction on three interrelated streams of
identity theory suggests that individuals define themselves partly research that, all combined, suggest that pre-negotiation percep-
ONLINE BARGAINING AND INTERPERSONAL TRUST
115
tions of trust may be influenced by Internet-based communication
Method
media.
Participants and Research Design
First, the difficulties resulting from the communication channel
restriction lead to another challenge that involves the expected
Participants were 134 full-time graduate-level business students who
ease of encoding, and expected difficulties in decoding, deceptive
participated in the study as part of a negotiation class assignment. The
messages. Although verbal inconsistencies may be an important
experimental design had one manipulation: mode of communication,
factor for determining the veracity of messages, people rely wherein negotiations were conducted either exclusively over the Internet
via e-mail or face-to-face. Negotiating dyads were randomly assigned to
heavily on visual indicators of arousal and nonverbal leakage when
one of the two communication media and served as the primary unit of
assessing sincerity (e.g., Anderson, Ansfield, & DePaulo, 1999;
analysis for our hypothesis tests. In total, 35 dyads negotiated via e-mail,
Ekman, 1985). Where nonverbal information is unavailable, as is
and 32 dyads interacted face-to-face.
the case with text-based messages, negotiators may find it easier to
Participants were also assigned roles and partners randomly, with the
engage in exaggerations, bluffs, and outright lies (Valley, Moag, &
restriction that no participant negotiate with another from the same class
Bazerman, 1998). If a negotiator recognizes that his or her oppo-
section. This cross-class context not only made the need for e-mail com-
nent has these sinister opportunities available, feelings of uncer-
munication credible, it also ensured that participants had not completed any
tainty regarding the other party s behaviors may increase and the previous negotiation-class simulations together. In addition, whereas in
some cases participants may have known their opponent, any potential
generation of trust may be inhibited.
effects here were controlled for by the random assignment of participants
In addition, it is also recognized that the potential for a broad
across conditions.
array of unethical and hurtful behaviors increases when a person is
removed, physically or psychologically, from the victim (Kelman
Procedure
& Hamilton, 1989). Thus, whereas the potential to exploit another
individual in a face-to-face negotiation exists, such potential be-
Each individual was provided with a packet of material containing the
havior may be perceived as being even greater when dealing with
negotiation case information, confidential role instructions, and an un-
a  faceless opponent (Walther, 1995).
sealed envelope containing a questionnaire. In the confidential instructions,
Finally, these uncertainties and anxieties regarding exploitation
participants in the e-mail condition were told that their negotiation was to
are further aggravated by the  sinister attribution error. As take place exclusively via e-mail, and they were provided with the name
and e-mail address of the other party. Similarly, in the face-to-face con-
Kramer (1994, 1995) noted, people facing diverse challenges and
dition, participants were instructed that the negotiation was to be done
stress may develop a heightened sense of paranoia. This could
exclusively face-to-face and were provided with the name of the other
make any initial concern about negotiating online an even more
party and a phone number by which to arrange a meeting.
salient obstacle to overcome.
Participants were informed both verbally and in the written instructions
Taken together, these three interrelated lines of research suggest
that their goal in this negotiation was to maximize their economic outcome.
that negotiating online encourages the perception that opportuni-
Participants were motivated to perform well on account of two sets of
ties are ripe for unethical behavior and, as such, the risk for being
reasons: Intrinsically, students indicate an enjoyment of these cases and
taken advantage of is high. In essence, the online medium yields
show enthusiasm toward achieving high-quality outcomes. Extrinsically,
significant pre-negotiation cause for concern and leads us to the course routine indicated that negotiated outcomes would be posted and
discussed during post-negotiation case debriefings. As such, the anticipa-
following prediction:
tion of a  public display of individual performance relative to others
provided the incentive to perform well as a matter of competitive pride.
Hypothesis 2: Negotiators who bargain online will exhibit
Participants were given either a pre- or post-negotiation questionnaire,
lower levels of pre-negotiation trust (i.e., before any interac-
but not both. Those who received post-negotiation questionnaires were not
tion) than those who interact face-to-face.
also given a pre-negotiation questionnaire because of concerns that pre-
negotiation questions might prime participants trust levels. Trial runs of
In a similar fashion, we expected that the reduced levels of
the experimental manipulation raised concerns and comments that the
interpersonal trust within the online context would have an influ-
pre-negotiation trust measure actually led participants to be less trusting of
ence in another relational aspect of the negotiation, specifically,
the other party during the negotiation. Consequently, this was addressed by
desired future interaction. In this regard, we expected that the
having participants who completed a post-negotiation questionnaire forgo
increased uncertainty presented in the e-mail context (as discussed
the completion of a pre-negotiation questionnaire. In addition, because we
above) would result in negotiators being less satisfied with the
were working in a classroom setting and were concerned about the appear-
quality of their interpersonal relationship than those who negotiate ance of parallel treatment, each person received only a single envelope of
material to complete. Consequently, those who received pre-negotiation
face-to-face. As such, we predicted that the hypothesized low
questionnaires did not receive the post-negotiation questionnaire. Pre- and
levels of trust in online negotiations would result in strained
post-negotiation questionnaires were assigned randomly to dyads across
relations such that online negotiators would have less desire to
the two conditions. Thirty-three dyads received pre-negotiation question-
have future interactions with the other party than those who
naires (n 17 dyads in the e-mail condition, n 16 dyads in the
negotiate face-to-face.
face-to-face condition), and 34 dyads received post-negotiation question-
naires (n 18 dyads in the e-mail condition, n 16 dyads in the
Hypothesis 3a: Negotiators who have bargained online will
face-to-face condition).
have less desire for future interaction with their opponent than
Those who were assigned pre-negotiation questionnaires were instructed
those who have interacted face-to-face.
to open and complete the pre-negotiation questionnaire after reading the
case material and approximately 1 hr before commencing the negotiation.
Hypothesis 3b: The desire for future interaction will be me- They were then instructed to seal the pre-negotiation questionnaire in the
diated by perceptions of an opponent s trustworthiness. provided envelope. In a similar fashion, participants who were given a
NAQUIN AND PAULSON
116
post-negotiation questionnaire were instructed to complete and seal the (i.e., negotiations) with them? Please give your response on a scale of 1 to
post-negotiation questionnaire within 30 min of completing the negotia- 100, with 1 being not at all and 100 being without hesitation.
tion. All questionnaires were returned, along with outcome information,
after the negotiation was completed. Participants were allotted 3 weeks to
Results
complete the negotiation, and outcomes and questionnaire material could
be turned in at any time during those 3 weeks. Our reported analyses were conducted at the dyadic level. No-
tably, the reported pattern of results was found to be equivalent
whether the analysis was conducted at an individual or a dyadic
Negotiation Task
level. However, because dependent variables were highly corre-
The negotiation task involved two managers representing separate divi- lated within dyads, we combined individual measures to form
sions of the same company negotiating for an intra-organizational transfer dyadic measures in order to eliminate any dependency concerns
of technology (Bazerman & Brett, 1997). This simulation,  El-Tek, in- within the data (Kenny, 1995).
volves multiple issues that vary in importance for each party and, as such,
Post-negotiation trust. Our first hypothesis examined post-
contains both fixed-sum and variable-sum elements. All outcome alterna-
negotiation trust levels. Consistent with our prediction, and as
tives have explicitly defined payoffs ranging from a maximum joint payoff
illustrated in Figure 1, a significant difference was observed in
of $15.1 million that is distributed between the two parties (as determined
post-negotiation trust levels based on our manipulation of com-
in the negotiation) to the impasse payoff in which the seller gets $5 million
munication medium. An analysis of variance (ANOVA) on these
and the buyer gets $0.
data indicated that participants who negotiated online via e-mail
reported significantly lower post-negotiation trust levels (M
Dependent Variables
3.66, SD 0.28) as compared with those who communicated
exclusively face-to-face (M 4.56, SD 0.18), F(1, 32)
Pre- and post-negotiation trust. To assess individuals level of trust in
118.23, p .01, 2 .78. The means, standard deviations, and
their counterparts, we used the Organizational Trust Inventory Short
intercorrelations between post-negotiation variables are shown in
Form (OTI SF) developed and statistically validated by Cummings and
Bromiley (1996). This scale contains 12 items geared toward assessing Table 1.
three dimensions of trust, including the reliability, honesty, and good faith
Pre-negotiation trust. Supporting our second hypothesis re-
of the other party with respect to fulfilling their commitments. In addition,
garding pre-negotiation trust, a significant difference in trust was
it also assesses both an affective and a cognitive component for each
also evident for negotiators who completed pre-negotiation ques-
dimension. We modified the OTI SF slightly to be more appropriate for a
tionnaires. In particular, online negotiators reported significantly
dyadic negotiation setting by asking individually based questions (e.g.,  I
lower pre-negotiation trust (M 3.41, SD 0.20) than did their
think rather than  We think ) and by substituting the words  the other
face-to-face counterparts (M 4.29, SD 0.29), F(1, 31)
party where the original questionnaire stated the name of the  other
100.22, p .01, 2 .76.
department or  unit. The reliability for this measure in the present study
Even though pre- and post-negotiation questionnaires were ad-
was acceptable, with Cronbach s .70. The modified OTI SF, as was
ministered to different groups at different times, we performed a
used to measure post-negotiation trust, is presented in the Appendix. The
pre-negotiation OTI SF that was used was equivalent to the one in the post hoc exploration into the magnitude of the difference between
Appendix, with the exception that it was phrased in the future tense.
pre- and post-negotiation measures of trust across media. When the
Outcome quality. Both the economic outcome and participants per-
data were entered into a two-way analysis of variance (ANOVA)
ceptions of the negotiated outcome were assessed. To assess objective
with the media manipulation, a main effect for time was observed
outcome quality we used an economic measure of success, assessed with
for levels of reported trust, F(1, 63) 18.44, p .01, 2 .23,
dollar gains. The El-Tek simulation provides an explicitly defined payoff
wherein post-negotiation trust was higher than pre-negotiation
schedule (included in the case material given to each participant) that
trust for all groups. The interaction of time with the manipulation,
readily yields quantifiable payoffs as a function of the negotiated deal.
however, was not significant, F(1, 63) 0.04, ns, suggesting that
These outcomes were analyzed with respect to participants ability to
improvements in trust were equivalent for e-mail and face-to-face
capture all available gains (i.e., integrativeness or efficiency) and also with
participants. Thus, the initial negative expectations evidenced for
respect to the distribution of those gains. Integrativeness was measured
with total joint gains, represented by the sum of both parties outcomes. For e-mail negotiators did not generate a downward spiral of hostility
the distribution of gains, we analyzed the dispersion of the agreements. In
this case, higher levels of variation in one condition relative to the other
might be indicative of a greater willingness to claim gains at the other s
expense, whereas a smaller variation might suggest a tendency toward
more  balanced deals. We measured subjective perceptions of outcome
quality by participants responses to two questions. First, participants
perceptions of the quality of their performance was assessed by responses
to the question,  How well do you think you performed in this negotiation
compared to others also playing your role? I did better than % of the
others playing my role. Second, participants overall satisfaction with the
negotiated outcome was evaluated on the basis of responses to the follow-
ing question:  How satisfied are you with the negotiated outcome? (1
not satisfied at all, 7 very satisfied).
Desired future interaction. From a relational perspective, we measured
participants willingness to have a continued relationship through re-
sponses to this question:  Based upon your experience in this negotiation Figure 1. Mean interpersonal trust as a function of communication me-
with the other side, to what degree are you willing to have future dealings dia. Open bars represent e-mail; solid bars represent face-to-face.
ONLINE BARGAINING AND INTERPERSONAL TRUST
117
Table 1 trust levels. In a regression analysis neither pre-negotiation trust
Means, Standard Deviations, and Intercorrelations Between ( .23, ns) nor post-negotiation trust ( .32, ns) was predic-
Post-Negotiation Dependent Variables, Dyad Level tive of negotiated joint outcomes. Similarly, neither pre-
negotiation trust ( .36, ns) nor post-negotiation trust ( .35,
Variable 1 2 3 4 5
ns) was predictive of individual objective outcome.
Subjective outcome quality. In contrast to the objective out-
1. Trust  .50** .39* .65** .14
come data that were available for all participants, subjective per-
2. Future interaction  .12 .39* .05
3. Outcome satisfaction  .29 .04 ceptual measures were limited to those who completed the post-
4. Perceived performance  .08
negotiation questionnaire (n 34 dyads). Here, significant
5. Joint outcome 
differences were found in the subjective perceptions of outcomes.
Participants in the e-mail condition reported lower confidence in
M 4.08 39.31 3.41 0.50 13.23
SD 0.51 17.78 0.92 0.20 3.01 their performance relative to others in their simulation role
Minimum 1 1 1 0 5
(M 0.37, SD 0.17) than did those in the face-to-face condition
Maximum 7 100 7 1 15.10
(M 0.65, SD 0.11), F(1, 32) 33.97, p .01, 2 .52.
Participants in the e-mail condition were also less satisfied with
Note. The minimum and maximum values listed in the table are theoret-
their outcome (M 2.97, SD 0.63) than those in the face-to-face
ical rather than actual (they specify the most extreme possible outcomes,
not actual results). condition (M 3.91, SD 0.95), F(1, 32) 11.62, p .01, 2
* p .05. ** p .01.
.27. Whereas online communication did not have a significant
effect on the objective economic nature of the outcome, it did have
a significant influence on how those outcomes were perceived.
in the interactions, nor was the interaction enough to overcome the Mediational analyses. Analyses were conducted to determine
initial deficiency in trust exhibited in the pre-negotiation measure. whether interpersonal trust mediated any of the following three
Desired future interaction. In Hypothesis 3A we predicted that variables: relational satisfaction (per Hypothesis 3B), outcome
participants who negotiated online would be less inclined to desire satisfaction, and confidence in performance. Following Baron and
a future relationship than those who negotiated face-to-face. This Kenny s (1986) recommended methodology for mediational anal-
hypothesis was confirmed. Online negotiators reported a signifi- ysis, we regressed the following: (a) the dependent variable on the
cantly lower interest in future relations (M 33.28, SD 16.92) independent variable, that is, media; (b) the purported mediating
than did persons in the face-to-face condition (M 46.09, variable, post-negotiation trust, on the independent variable; and
SD 16.68), F(1, 32) 4.92, p .03, 2 .14. (c) the dependent variable on both the independent variable and the
Objective outcome quality. Outcome quality is reported in two mediating variable. These analyses revealed that for (a) partici-
ways: objective and subjective. First we report an analysis of the pants confidence in their performance and (b) their outcome
objective outcomes. The objective outcomes were turned in as satisfaction, trust was not a significant mediator ( .08, ns;
regular class submissions and were available for all participants .02, ns, respectively). However, in support of Hypothesis 3b, trust
regardless of whether they had completed the pre- or post- was found to be the mediating mechanism for the desire to work
negotiation questionnaire. Consequently, the reported analysis of together again in the future. Significant results were observed for
objective outcomes includes all participants. the influence of trust on desired future interaction ( .35, df
With respect to impasse rate, a logistic regression analysis 33, p .01), and they remained even when entered with the
revealed that no difference was observed between communication communication media manipulation ( .31, df 33, p .05).
media for impasse rate, with 6.3% of dyads in the face-to-face The effect of media was concurrently reduced to nonsignificance
condition impassing (n 32) versus 8.6% in the e-mail condition ( .08, ns). In summary, post-negotiation trust in a negotiation
(n 35), .34, ns. was found to be a significant mediator for desired future interac-
Similarly, no differences were observed for either the creation of tion but not for perceptions of outcome satisfaction or one s
joint gains or the distribution of gains. Dyads in the e-mail con- confidence in performance.
dition (M 13.32, SD 2.89) captured an equivalent number of
points to those in the face-to-face condition (M 13.38,
General Discussion
SD 2.61), F(1, 65) .01, ns. To examine the balance of gains
between individuals, we used a Kolmogorov-Smirnov test (see The goal of the present research was to extend our understand-
Sheskin, 2000). The Kolmogorov-Smirnov test compares two dis- ing of (a) negotiation and (b) the social psychological conse-
tributions to determine whether they are equal. Higher levels of quences of interacting via the Internet by empirically examining
variation in one condition relative to the other might be indicative how negotiating online influences interpersonal trust. The reported
of a greater willingness to claim gains at the other s expense, findings demonstrate that negotiators who bargain online may
whereas a smaller variation might suggest a tendency toward more bring different expectations to the electronic bargaining table than
 balanced deals. Results suggested that e-mail (M 6.65, when they negotiate face-to-face, resulting in a host of potential
SD 1.94) and face-to-face (M 6.69, SD 1.66) participants detrimental consequences on the perceptual and relational dynam-
had statistically equivalent variance (Kolmogorov Smirnov Z ics in a negotiation. For example, trust in the opposing party of a
.51, ns). In total, no differences were observed for joint gains or in pending negotiation was significantly lower in the online context
the distribution of gains as reflected in individual outcomes. than in the face-to-face condition. This was before any interaction
One final exploration into objective outcome quality revealed commenced and thus was necessarily rooted in expectations rather
that the economic indicators showed no connection to negotiator than in processes within the negotiation. In addition, our prediction
NAQUIN AND PAULSON
118
that the desired future interaction would be damaged in the online al., 1999; Morris et al., 1999). All participants in the present study
context was confirmed, and this effect was mediated by trust. knew that although their opponent was not in the same class
Finally, although agreement rates and outcome quality measures section, they were students at the same university (via the e-mail
were parallel between online and face-to-face contexts, the levels address), perhaps yielding an initial basis for identification and
of confidence and outcome satisfaction were much higher in the comfort. Thus, competitive choices may have been minimized for
latter condition. These interpersonal deficiencies and perceptual all persons in our study. Alternatively, it is possible that the length
concerns suggest that persons seeking a more lasting exchange of time required to reach an agreement in an online setting is
relationship would be wise to build a base for their interactions greater (Kiesler & Sproull, 1992) such that the ample time offered
through some other medium (e.g., Drolet & Morris, 1995) or to to our participants (3 weeks) may have provided an opportunity to
take steps to correct for initial trust problems. arrive at a negotiated settlement. In cases in which persons are
These findings may appear somewhat at odds with the argu- allotted less time, the media effect on impasse may be stronger.
ments presented by Drolet and Morris (1995) in their comparisons Unfortunately, negotiators do not always have the luxury of
of telephone and face-to-face negotiators. Their results indicated a choosing their communication medium in today s organizational
trend toward differing expectations between media but no signif- landscape. There may be times when the Internet is the only
icant limitations therein. Instead, they argued that a lack of non- available or feasible opportunity for communication. If this is the
verbal cues inhibits the development of interpersonal synchrony case, one might make a strategic effort to overcome the reported
necessary to build rapport, which subsequently inhibits coopera- hazards of the e-mail context while still enjoying the benefits that
tion. In the online context, we recognize that the limitations of the the medium provides. One avenue by which to accomplish this
Internet are even more restrictive (Trevino et al., 1990) as the (building on theory and research in trust development) is through
nonverbal cues carried via vocal inflections and intonation (i.e., deterrence- or identity-based approaches. For example, one may
 vocalics ) are removed as well. Additionally, differences ob- minimize uncertainty by attempting to establish norms governing
served in the pre-negotiation (i.e., pre-interaction) trust levels appropriate online behaviors or by building a common sense of
cannot be accounted for by nonverbal behaviors. Although we do identification between parties through an exchange of personal
not have data with respect to behavioral synchrony or rapport, our background (i.e., chitchat). This is an area of considerable practical
findings are clearly suggestive that differences in some post- importance and warrants further research.
negotiation perceptions and intentions are, at least partially, im- Further research into the boundary conditions of these reported
pacted by differences in initial expectations. media effects is warranted. For example, in negotiations in which
These findings also contribute to the literature by suggesting e-mail messages are knowingly archived, some forms of deception
that the greatest problems for online negotiations may be associ- may be problematic, thus promoting an atmosphere of trust. Hav-
ated with creating positive relationships and feelings rather than ing statements  on the record and verifiable may make factual
with the creation of low-quality agreements. This is interesting in misrepresentation an unattractive option. However, exaggerated
that contextually based conditions (i.e., media) translated into demands (i.e., bluffs) might occur more readily, as the bluffer
broad judgments of the personal characteristics of the other party. could more easily  keep their story straight by reviewing their
In particular, online negotiations yielded lower levels of interper- prior personal dialogue. Researchers might draw on work on the
sonal trust that, in turn, generated negative assessments with verbal correlates of deception (e.g., Vrij, Edward, Roberts, & Bull,
respect to the suitability of the other individual for future business 2000; Zuckerman & Driver, 1985) to more carefully explore the
dealings. opportunity for, and the use of, various forms of misrepresentation
Our data also showed comparable objective economic gains in this context.
between online and face-to-face negotiations but significant dif- Another noteworthy opportunity for future research is rooted in
ferences when it came to how those outcomes were perceived. the limitations of the current study. We speculated that the ob-
Participants who negotiated via e-mail had lower confidence in the served pre-negotiation effects on interpersonal trust may influence
quality of their deal and lower overall satisfaction with the out- negotiation processes and expectations, such as norms of informa-
come than did those who negotiated face-to-face. These findings tion exchange, strategy selection, or the use of specific tactics (e.g.,
regarding outcome perceptions, however, were not directly medi- deception, threats). However, our insights were limited by a lack of
ated by trust. As such, the influence of trust on these subjective interaction data, and this opens the door for future investigation.
perceptions may instead be tied more closely to differences within We also hold out hope for negotiations in the online context. In
the negotiation processes or in the messaging system itself (e.g., the present study, prior in-class negotiation interactions between
Morris et al., 1999). participants were minimized. It may be the case that if negotiations
These findings of more negative subjective perceptions of out- took place between colleagues with a positive history, their exist-
comes may also help to explain why prior research has found that ing relationship could overcome the problems associated with the
online negotiators have a more difficult time reaching an agree- online environment. In such circumstances, the initial pre-
ment (Moore et al., 1999). To the extent that a negotiator feels that negotiation differences observed in this study may be minimized
he or she is receiving a low-quality offer or outcome, impasse may or eliminated, yielding more beneficial relational and outcome
be viewed as the most sensible choice regardless of absolute gain perceptions.
(Neale & Bazerman, 1991). In the current study no differences
were found in impasse rates between the two experimental condi-
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Appendix
Post-Negotiation Trust Questionnaire
Please circle the number to the right of each statement that most clearly describes your opinion of members of
the other party.
Strongly Slightly Neither agree Slightly Strongly
disagree Disagree disagree nor disagree agree Agree agree
1 2 345 6 7
1 I think the other party told the truth in the
negotiation. 1 2 3 4 5 6 7
2 I think that the other party met its
negotiated obligations. 1 2 3 4 5 6 7
3 In my opinion, the other party is reliable. 1 2 3 4 5 6 7
4 I think that the other party succeeds by
stepping on other people. 1 2 3 4 5 6 7
5 I feel that the other party tries to get the
upper hand. 1 2 3 4 5 6 7
6 I think that the other party took advantage
of my problems. 1 2 3 4 5 6 7
7 I feel that the other party negotiated with
me honestly. 1 2 3 4 5 6 7
8 I feel that the other party will keep its word. 1 2 3 4 5 6 7
9 I think the other party has not misled me. 1 2 3 4 5 6 7
10 I feel that the other party tries to get out of
its commitments. 1 2 3 4 5 6 7
11 I feel that the other party negotiated joint
expectations fairly. 1 2 3 4 5 6 7
12 I feel that the other party takes advantage of
people who are vulnerable. 1 2 3 4 5 6 7
Note. Items 4, 5, 6, 10, and 12 were reverse scored.
Received October 4, 2001
Revision received April 22, 2002
Accepted April 22, 2002