STRATEGY

Contrasted with structural analysis' focus on means as the explanatory concept, strategic analysis uses the rational choice of ends as its terms of analysis, as portrayed in game theory and other rational choice approaches.

Yet the basic presentations of Prisoners' Dilemma (PDG) and the lesser-used Chicken Dilemma Games (CDG) launched a whole body of literature on negotiation. In these meta-games, both power and process were explicitly excluded, the outcome being explained by the values assigned to various outcomes (Nash 1950, 1953; Powell 2002; Avenhaus & Zartman 2007). Again, the analysis showed that for parties caught in a perceived PDG situation, the determinate outcome or Nash equilibrium is not to negotiate, lest their concession leave them open to be zapped by the other party. As a result, the challenge of negotiation is to find ways of building trust that would establish requitement, the sense that conces­sions will be reciprocated. The best known device is to establish a reputation in order to “teach requitement” by opening “soft” with a concession and playing Tit-for-Tat thereafter (Cross 1969; Bartos 1978; Axelrod 1984; Brams 1990). The analysis coincided with the introduction of GRIT (Gradual Reciprocation in Tension Reduction) strategy by Charles Osgood (1962) during the Cold War.

Although it has limited direct use for portraying situations of negotiation, PDG is a cartoon portrayal of many situations of inter­national conflict that long defy negotiation, as discussed by Avenhaus in this volume. Its popularity was doubtless enhanced by its accurate depiction of the Cold War in general (“Better dead than Red”), although by that fact it inhibited or hid real possibilities of East-West negotiation (Kanet & Kolodziej 1991). Another situation captured by PDG has been the Arab-Israeli conflict, but here the delicate process of getting around the dilemma by establishing trust and requitement is well exemplified in the tactics leading to and through the Oslo Agreement of 1993 (Pruitt 1996), subsequently abandoned. PDG also accurately captures such territorial conflicts as the Indo-Pakistani conflict over Kashmir and the Morocco-Algeria conflict over the Western Sahara, among others. There is a huge literature on the role of mediators as a crutch of trust to permit negotiation, covered in the following chapter by Bercovitch.

Another important way of escaping the inhibitions of the PDG is to change the game, through a reevaluation of the end values. One important change is to a CDG, wherein the worst outcome is deadlock (mutual defection or security point) rather than being zapped by the opponent (“Better Red than dead”). Here there is no determinate outcome but two Nash equilibria favoring each party, respectively, creating a coordination rather than a collaboration problem (Snyder & Diesing 1977; Stein 1983 Wagner 1999). But CDG like PDG is a situation of perceived symmetry, so another change in the game would be to introduce asymmetry and thus power. This represents the tactic used by the USA under President Kennedy to end the Cuban Missile standoff (1962) and by President Reagan to end the Cold War in 1989 (Brams 1985).

The study of end value asymmetry has given rise to a large literature sometimes termed negotiation analysis or models for negotiation which seeks to obviate the lengthy and inefficient process of negotiation by indicating fair outcomes based on end values assigned by the parties (Young 1994; Raiffa with Richardson & Metcalfe 2003; Brams & Taylor 1996). While such a procedure might be of use in arbitration-type situations of a CDG, where any end of conflict is preferable to continuing conflict but where the parties are satisfied by a division deemed fair, it is unlikely to be welcomed in situations of sharp conflict over indivisibles or over non­tradables, situations where process ownership is important, or situations where the stakes include high political commitment, in other words, most intrastate and many interstate conflicts. In this as in other types of formal modeling for and of negotiation, the analysis removed from real world relevance by its absence of process, often based on Rubenstein’s (1982) take-it-or-leave-it games that avoid Ikle’s (1964) basic three-fold choice (yes, no, keep on talking) as the essence of negotiation.

The task of assigning end values and rankings is often difficult enough but a more precise analysis requires identification of cardinal values for outcomes, which tends toward the impossible, at least in non­monetary cases of conflict. An additional complication has been introduced by a significant reinterpretation of end values, termed prospect theory (Farnham 1992; Tversky & Kahneman 1995; MacDermott 2007). Prospect theory indicates that losses are more highly valued than gains, that parties are more risk-taking over losses and risk- averse over gains, and that the referent frames that parties use determine the comparative value of ends. These considerations make end-based analysis much less reliable while introducing tactical elements that are crucial to effective negotiation.

Another way of analyzing negotiation using game theoretic concepts is to focus on the strategies of the parties, their “general plan[s] of action containing instructions as to what to do in every contingency” (Shubik 1964, p.