What - - if any - - role do notions of fairness play in negotiations? Most of the lit- erature on conflict resolution to date would lead the scholar to conclude that "rational" attempts to maximize individual gains motivate the course and out- come of negotiations. In such a competitive context, fairness arguments are sup- posedly used as a cover only, to couch the pursuit of self-interests at the expense of the other side. Thus the conclusion of a particular agreement reflects the out- come of a contest, not a judgment on whether the agreement is "fair:' Reasoning along these lines - - and the daunting task of initiating research on such a slip- pery concept, of which there is not at this point even a preliminary base of knowledge on which to stand - - certainly explain, to a large extent, the scarcity of studies on the subject.
Yet the actual practice of negotiation - - including in areas of global signifi- cance, such as the environment - - suggests that concepts of fairness are often an influential factor. They influence the "give-and-take" in the bargaining process, help parties to forge agreement, and help to determine whether a par- ticutar outcome will be viewed as satisfactory, and thus be honored in the long rim. Notions of fairness may create a motivation to resolve a particular problem through negotiation in the first place, and thus have an impact on the positions and expectations which parties bring to the table. A linfited body of research on negotiation, experimental and social psychological in particular, supports these propositions.
One may, however, legitimately question the universal significance of fair- ness in negotiations: Is it a predominantly Western, perhaps even American, con- cept? Social psychological research suggests that the importance attached to fairness in dispute resolution is crosscultural, although different cultures appear to stress different fairness principles. Undoubtedly, fairness is often used by par- ties to justify and bolster their negotiating positions and particular procedures or
Cecilia Albin is a Research Scholar in the Processes of International Negotiations (PIN) Project at the International Institute for Applied Systems Analysis (IIASA), A-2361 Laxenburg, Austria.
outcomes favoring their interests. Parties frequently endorse fairness norms - - and interpretations of them - - which best favor their interests. Little research exists on such tactical uses of fairness, and that topic is beyond the scope of this article. In most negotiations, genuine notions of fairness play a role for reasons that are both intrinsic (ethical) and practical: They help the parties evaluate alternatives for a solution, coordinate expectations and forge agreement, and fos- ter good relations for future dealings. To avoid constant confrontations and stale- mates in negotiations, and the possibility of the other side opting for another avenue to serve its interests, each party must consider what the other side would regard as a fair bargain and moderate its inclination to claim as large a share of the resources as possible. Like unfounded threats and promises, fairness would also lose its tactical value if parties did not attach a genuine substantive worth to the concept as well.
The role of fairness notions is more significant or prominent in some types of negotiations than in others, and the characteristics of these is another subject still left unexplored in the research literature. Intuitively, one would think that fairness issues are particularly important in negotiations that continue over a period of time and thus build up expectations about "fair" behavior and the shape of a fair agreement. Examples include global environmental negotiations, arms control talks, the settlement of everyday disputes within the family, and negotiations over highly valued, scarce goods, or ethical (e.g., life-and-death) issues. Fairness issues would also tend to be prominent in situations where bene- fits and costs are not easily distributed among parties - - as in negotiations over transboundary and local environmental issues (e.g., the siting of hazardous waste storage facilities). Yet in most cases, fairness will be at least one factor, among others, which explains the dynamics of the negotiation process, the outcome, and its durability.
Notions of justice and fairness are truly interdisciplinary. Scholars from such fields as philosophy (Rawls, 1971), social psychology (Deutsch, 1973), math- ematics (Steinhaus, 1948; Raiffa, 1982), and economics (Homans, 1961; Foley, 1967) have all made notable advances. A small body of literature has related these insights to negotiations, and then focused on the outcome - - on different princi- ples that may underlie negotiated agreements, or so-called "distributive justice ?' The point of departure in this literature is a negotiation over the allocation of a limited amount of divisible resources; thus, fairness has generally been exanlined as a distributive concept. Virtually no attention has been devoted to process or procedural fairness, particularly in integrative negotiations; outcome fairness in conflicts involving indivisible resources or benefits/burdens; the role of notions of fairness in explaining the onset or absence of negotiation or post-agreement negotiations; and relationships between types of fairness (e.g., procedural and outcome). Most importantly, the limited literature on the subject to date has typi- cally singled out a particular aspect of negotiations - - usually the outcome - - on which fairness notions have an impact, as if it were the only one.
The purpose of this article is to help develop a framework for conceptualiz- ing the multiple roles played by fairness in negotiations. The few research find- ings available on the subject to date make it necessary to take a broad, preliminary approach. At the same time, some important aspects of the major issues raised are examined in detail, including the different roles which fairness plays in distributive and integrative negotiations.
224 Cecilia Albtn The Role o f Fairness in Negotiation
Def'ming Justice and Fairness "Justice" can be thought of as a mac ro -concep t w h i c h refers to general princi- p les for the dis t r ibut ion of resources and obl igat ions in society as a whole . Typi- cally, t h e f o c u s o f j u s t i c e is o n t h e o u t c o m e r a t h e r t h a n t h e p r o c e s s o r p rocedure s w h e r e b y it is p r o d u c e d - - h e n c e the t e rm "distributive just ice" A key character is t ic of just ice no rms is that t hey have been es tabl ished p r io r to and i ndependen t ly of any specific p h e n o m e n o n to be judged - - a l though thei r specif ic in te rpre ta t ion or appl ica t ion at the micro-level is of ten far f rom obvious. Concep t s of "fairness" b y contrast , are more contextua l and specific. They are individual (psychological ) not ions relat ing to a par t icular conflict , negotiat ion, and /o r ou tcome, and include views on h o w to app ly any b roader pr inc ip le of justice regarded as pe r t i nen t to a specific context . Views on the legi t imacy of one ' s o w n claims to the d i spu ted resources (as o p p o s e d to the o the r side 's) are a n o t h e r i m p o r t a n t e l e m e n t o f fairness not ions . Negot ia to r s natural ly t e n d to v iew and refer to thei r o w n fairness no rms as "justice" - - as cr i ter ia ref lect ing some h igher ethics going b e y o n d par t isan percep t ions , interests, and situational factors.
Fairness issues, of course , raise a fundamenta l quest ion, "fair to whom?" Fair to a par t icular pa r ty or all part ies, fair in the eyes of the wor ld communi ty or to future generat ions, o r to whom? To make ag reemen t possible, the p r imary chal lenge is of ten to br ing about a p rocess and an ou t c ome that are as fair as poss ib le for the g roup of par t ies as a w h o l e and for the individual pa r ty - - and to strike a "fair balance" b e t w e e n the two object ives w h e n they are conflict ing.
Fair p rocesses and fair ou tcomes are no t necessar i ly accep tab le overall to parties, no r are they always efficient or even logical. Rather, fairness is an ele- men t o f acceptabil i ty. Provisions for guarantee ing and moni to r ing implementa- tion, the l ike l ihood of enduring, and poli t ical feasibility are o the r factors w h i c h c o m m o n l y d e t e r m i n e w h e t h e r a p a r t i c u l a r a g r e e m e n t wi l l b e r e g a r d e d as accep tab l e . D e p e n d i n g on the case, fa irness may - - o r may n o t - - s tand in d i rec t con t ras t to efficiency. Much has b e e n w r i t t e n a b o u t the n e e d for and p rob l ems of tradeoffs b e t w e e n fairness and efficiency, par t icular ly in publ ic pol- icy d isputes such as the siting of hazardous was te storage facilities. Some under- s tandings o f o u t c o m e fairness inc lude eff iciency considera t ions , whi le others , such as t he "oppor tun i t i e s " n o r m (Pruit t , 1981), even equal ize fairness w i t h efficiency.
This s tudy ident i f ies and analyzes four t ypes o f fairness w h i c h have an impac t on negotiat ion: s tructural fairness, p rocess fairness, p rocedura l fairness, and ou t come fairness. In any one case, all four types o f fairness will not necessar- ily be significant no r even present . Whi le conce rns about ou t c ome fairness are c o m m o n l y thought to domina te negotiat ions, in some contex ts no ou t c ome can be quite fair - - e.g., in the al locat ion of a single indivisible good or bu rden for w h i c h there is no adequate compensa t ion , such as a dea th miss ion or a child in a cus tody dispute. Parties may then agree to use a p r o c e d u r e v i ewed as fair for set- fling the issue, and to accep t wha teve r (unfair) solut ion it p roduces . Similarly, w h e n a negot ia t ion p rocess canno t be fair in impor t an t respec t s (e.g., pe rmi t pa r t i c ipa t ion by all par t ies o r pub l i c scrutiny), g rea te r de ma nds wil l of ten be advanced regarding the fairness of its ou tcome.
Whi le analytically useful, the four categories are no t always dist inct from one another, even conceptually. An ou t come v i ewed as fair may, in effect, be a
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fair procedure (e.g., for allocating a scarce resource on a continuous basis). Ele- ments of structural fairness, such as the grouping of issues, influence outcome fairness; notions of outcome fairness often influence the choice of "fair" proce- dures; and particular procedures will, in turn, have an impact on the outcome. Some procedures (e.g., problem-solving techniques) may help to "neutralize" structtwal variables such as power asymmetry, or may be part of the structure themselves.
S t r u c t u r a l F a i r n e s s
We commonly think of fairness as relating to the outcome, and perhaps also the process, of negotiations. Yet an important class of fairness issues concerns the overarching structure of the negotiation process which, in turn, reflects more or less the structure of the dispute and overall relations be tween parties. These s t r u ~ l components concern the physical, social, and issue constraints within which the negotiat ion process unfolds and negotiators opera te (Rubin and Brown, 1975). They involve central fairness issues, for they have a considerable impact on the progression of the negotiations (e.g., the pattern of concession- making), the nature of the outcome, and judgments of its fairness. For example, if the structure is viewed as weighing heavily against a particular party, this party is unlikely to regard the product of the negotiation as fair. At the onset of talks, the structural elements are typically the "givens" determined earlier in prepara- tory discussions or by extraneous factors. Most of these elements remain con- stant throughout the negotiation process, and influence it in ways that are often significant but difficult to discern.
P a r t i e s A major set of structural components concerns the parties to the negotiations, including any third parties: their identity; number; attributes (e.g., interests, amount of resources); representation; and relations, including the distribution of resources between them. A classic illustration of the importance of identity and number is the continuing battle over whether Jordan, the Palestine Liberation Organization (PLO), or the Palestinian residents of the occupied territories is the party to negotiate a settlement with Israel on the West Bank and Gaza, and Arab states' long-time insistence that the furore of these territories be determined in a multilateral forum rather than in separate bilateral talks. The idea that every major party to a conflict, or groups most affected by the outcome, should be given a genuine opportunity to be represented in the negotiations is regarded as a key- element of fairness which significantly influences perceptions of the legiti- macy of the outcome and the chances of its implementation. An example is negotiations over the siting of hazardous waste treatment plants, prisons, and other unwanted facilities.
In some cases, it may not be practically possible to have all parties at the negotiating table, such as the larger public and future generations; and it may indeed be unfair to insist that others be at the table, such as children in divorce settlements. Then their interests are still to be represented somehow, even if only indirectly. Regarding the representation of future generations in international environmental negotiations, the issue today is not whether but how their interests can be measured and who can represent them fairly (by states as is the case today or, for instance, by a formal transnational representative). The right of every party
226 Cecilia Albin The Role o f Fairness in Negotiation
to choose freely its own representatives to the talks is another structut~ fairness element, for limitations on this right typically serve to influence the course of the negotiations and the substance of the outcome in a particular direction. For example, in the Middle East peace process resumed in late 1991, the condition that Palestinians form a joint delegation with Jordan, and the ban on fifll participation by" East Jerusalemites and members of the PLO in this delegation, have served the U.S. and Israeli-supported objectives of leaving the issues of Palestinian statehood and the sovereignty over Jerusalem off the negotiating table.
The presence and involvement of mediators and other third parties also raise fairness issues. Outside actors may serve to reinforce the existing structure (e.g., prevailing power relations between parties) or determine it initially (e.g., issues to be discussed in the talks). They can also change the structure of the negotiating process by adding their own interests and resources, and by support- ing a particular side to the conflict. In order for the process and outcome to be viewed as fair, the outside actor is then often expected to use its special relation- ship with the favored side to move it toward an agreement. A central difficulty in the international environmental area is to get serious negotiations underway and arrive at fair agreements in view of countries ' asymmetrical positions with respect to responsibility for and ability to live with the problems at hand, resources available to reduce them, costs likely to result from regulatory agree- ments, and ability to bear these costs. A case in point is the U.S.-Canada acid rain negotiations.
I s s u e s A second group of structural elements concerns the issues to be negotiated - - their number and grouping as they appear on the agenda when negotiations begin; their complexity and "sums" (degree to which they are, or are perceived as, zero-sum or positive-sum); and relationships between them (e.g, degree to which they are separate or intertwined). Often the grouping of issues will be a "given" to a certain extent: Some issues, as in environmental negotiations and ethnic conflicts, are simply so closely intertwined that they can be usefully dis- cussed only together. However, there is always room for adding some related or unrelated issues.
Such linkages raise important fairness issues. By grouping certain issues together on the negotiating agenda, the assumption and expectation are that legitimate tradeoffs can be made between them. Further, linkages can be used to mobilize one side's power and leverage over the other side on some issue. Cer- tain proposals for Jerusalem bring in the issue of a Palestinian state in the West Bank and Gaza as a "concession;' to elicit Palestinian acceptance of permanent autonomy in the city under Israeli sovereignty. Critics hold that such a linkage is unfair: Jerusalem, of great importance to Arabs worldwide, cannot be fairly exchanged for concessions on a predominantly Isracli-Palestinian issue; and the West Bank and Gaza are Palestinian land, the legitimate return of which to Pales- tinian hands cannot be traded for another Palestinian-Arab area which is East Jerusalem.
Rules Another category of structurM fairness elements is the rules and codes of con- duct to govern the negotiations, and ways in which these are established. These elements include agenda-setting (e.g., issues to be negotiated, their order on the
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agenda, time allowed for each issue); communication procedures between par- ties and with the outside world (e.g., use of press conferences to report on progress or deadlocks); voting procedures; and the use of deadlines and other time limits. A common notion of fairness is that parties, whether equal or not in power, should have an equal chance to determine the agenda, equal control over the use of deadlines, and so forth.
Physical Features of the Negotiations Finally, a major set of structural elements involving fairness issues concerns the physical features of the negotiations: the location; the presence and degree of access of various audiences to the negotiations; the availability of communica- tion channels between parties; and access to information and technical support. The location is known to influence parties' control over physical art~.ngements, and their psychological mood and assertiveness in negotiations (Rubin and Brown, 1975). Thus the selection of a neutral site (outside the home territory of either party or any close allies) or, if the talks are to continue over a period of time, alternation between partisan sites, is an important element of structural fairness. Openness of the site and the negotiation process to public scrutiny is often viewed as a fairness issue (Susskind and Cruikshank, 1987) - - although it often has a negative impact on the flexibJfity of adopted positions and conces- sion-making, thus harming the possibilities of reaching agreement, including fair agreements.
P r o c e s s F a i r n e s s
Process fairness concerns two broad issues: the extent to which parties in the process of negotiating relate to and treat each other "fairly"; and how parties' notions of (outcome) fairness influence the dynamics of the negotiation process, including their choice of procedures for arriving at an agreement.
Process Fairness as Fair Behavior "Fair behavior" in negotiations can be defined as the extent to which parties actually honor agreements reached on many structural issues before the process began, and the degree to which they use procedures without deception in the effort to find a solution. The first criterion to assess fair behavior leads to ques- tions such as: Is every party to the negotiation or affected groups given an ade- quate chance to be heard and have an input into the process at each stage - - from framing the problem, identifying and assessing alternative solutions, to making the fmal decision? In international environmental negotiations, fair treat- ment of future generations is viewed as requiring that their interests are not sub- ordinated to those of the present generation - - more broadly, that issues are not resolved at the expense of the interests of affected parties unable to participate in the talks.
Further, are the hales of the game initially agreed upon actually followed (unless parties agree to change them) - - e.g., regarding the time allotted to the discussion of each issue? Does any third party involved respect its mandate or go beyond it? The centerpiece of fair behavior by a third party is indeed to ensure that the process accounts as far as possible for all parties' interests, and that every party is able to freely accept or reject its suggestions. Finally, are linkages (implicit or explicit) made in the course of negotiating to elicit concessions, in "unfair" ways? Consider, for example, negotiations over the siting of hazardous
2 2 8 Cecilia Albin The Role o f Fairness in Negotiation
facilities, whe re a demand that host communi t ies make tradeoffs be tween safety/health concerns and economic considerations is commonly viewed as unethical and unfair (Susskind, 1990). As another example, some observers argue that the U.S. linkage of $10 billion in loan gtmrantees to a freeze on Israel's settle- ment activity in the occupied territories in the spring of 1992 was unfair, because it politicized supposedly humanitarian aid to Soviet immigrants in the country.
Fair behavior also concerns the use of deceptive and coercive tactics. Many" procedures for reaching agreement, both distributive and integrative, provide ample opportuni t ies for using such tactics at the expense of the other side. X~qaen successftdly employed, such tactics can lead to unfair agreements without the knowledge of the exploi ted par ty (or no agreement is reached). They include bluffing about real payoffs and the adoption of highly- inflated positions with the expectation that "the difference" will be split, maless parties' positions are knowingly inflated to the same extent. In using integrative techniques, the centerp iece of fair behavior involves a will to give truthful information, as required, about concerns and priorities, and to attempt to redefine the problem and invent options which may serve the interests of both sides.
Is it always unfair to use deceptive and coercive tactics? A useful distinc- tion can be made between misrepresenting one's interests and alternatives, as opposed to lying about the substance of the items being negotiated. Thus it would be fair to use threats and misrepresent values with regard to the former, but rarely the latter, when all parties know and accept, explicitly or implicitly, that such tactics are part of the males of the game. Other criteria concern the implications of everyone using the same tactic, the availability of other tactics that pose fewer ethical problems, and discomfort experienced if one's use of the tactic became widely known or ff it was used against oneself (Lax and Sebenius, 1986). Although difficult to opcrationalize in many real situations, such standards at least begin to spell out possible conditions under which commonly unfair tac- tics can indeed be fair.
The Influence o f Fairness N o t i o n s on D i s t r i bu t i v e vs. In tegra t i ve N e g o t i a t i o n s What role do notions of fairness play in the process of negotiating? As further discussed below, they influence the choice of particular procedures for exchang- ing concessions or inventing new alternatives for an agreement. But more gener- ally, do fairness concepts serve as instrumental "focal points" which coordinate expectations and help parties forge an agreement worth honoring and imple- menting (Yotmg, 1991; Schelling, 1960)? Or are they themselves subject to bar- gaining? Do they facilitate or complicate negotiation and agreement?
In response to such questions, a distinction should be made between negoti- ations that are either predominantly distributive or predominantly integrative, ha research to date, fairness notions are examined only in distributive contexts with a focus on the outcome - - sometimes with the explicit assumption that they are irrelevant in integrative negotiations. Although the creative and diffuse nature of integrative negotiation makes the fairness issues involved less manifest, they play as much of a role, although a different one, in that approach. Of course, even the most integrative negotiation must be concluded by allocating the joint gains cre- ated in the process of deliberation (and thus involves some distributive fairness issues). Conceptually, however, the two approaches are fimdamentally different.
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Fairness in Distributive Negotiations The essential function of negotiation in the distributive approach is to allocate a limited amount of divisible items (benefits and/or burdens). The process is t3~i- caUy considered a one-time encounter to settle a single issue. Parties move toward a compromise agreement by exchanging concessions in reference to fixed, identifiable positions wi thout special analysis of concerns motivating these. Opening demands, values and interests remain unchanged in the negotia- tion process. Beyond the shared interest in reaching agreement, parties' stakes are conflicting: One party's loss is the other's gain. Thus competitive strategies are pursued to maximize private shares of the resources available within given constraints - - e.g., the need to consider issues of fairness. The approach is deter- ministic in predicting the type of movement toward agreement, the range of possible outcomes based on payoff structures, and the final outcome as a point between parties' initial positions (Bartos, 1974; Walton and McKersie, 1965). In the concession-convergence model, the classic distributive model, an overriding factor - - e.g., learning or coordination of expectations about concession rates (Cross, 1969) - - determines the progression of moves to agreement.
Together with such factors as interests and calculations of power or the other's likely concessions, fairness notions in distributive negotiations influence each party's concept of its "bottom line" - - the minimum for which it will settle. This, in turn, influences its opening position and the degree to which that posi- tion is viewed as possible to compromise. As each party presents its opening demands and considers those of the other side, a point of agreement viewed as desirable and fair often emerges somewhere in between the two positions. In the model of Bartos (1974), which articulates what is usually left implicit about the role of fairness notions ha distributive negotiations, this particular point is a split-the-difference solution exactly at the midpoint be tween parties' opening positions. Experimental findings suggest that this is a commonly accep ted notion of outcome fairness, for it demands equal concessions from both sides (Benton and Druckman, 1973). The presence of a joint notion of outcome fair- ness appears to weaken zero-stLm perceptions, speed up concession-making, make agreement more likely (at the prominent alternative), and decrease the impact of other factors on the bargaining process (Joseph and Willis, 1963). These effects may be partly explained by the idea that a joint notion of outcome fairness helps to overcome the problem of "partisan biases" - - the tendenc T to overvalue one's own concessions and underestimate those of the other side (Fisher and Brown, 1988).
ff and when such a joint concept of a salient outcome emerges, it deter- mines what parties view as fair concessions. In the movement toward the pre- conce ived poin t of agreement , it guides the actual scope (size) and rate (number) of their concessions. Specifically, w h e n an equal-split solution is viewed as fair, parties strive for maintaining a midpoint between their original positions and subsequent offers. Thus, in distributive negotiations in which a joint notion of outcome fairuess exists, it serves as an instrumental coordinator of expectations about concessions and the point of agreement. Fairness notions are not negotiated, but rather guide the negotiations toward the recognized point of convergence. Schelling's "focal points" - - typically simple fairness prin- ciples, such as split-the-difference or equal shares - - are points of agreement which appear as reasonable, qualitatively superior solutions because of prece-
230 Cecilia Atbin The Role o f Fairness in Negotiation
dent, analogy, custom, cultural norms, or similar factors. Apart f rom any inherent value attached to them, parties settle at such focal points because an at tempt to forge agreement at some o ther point is expected to involve greater costs than gains (Schelling, 1960). For example, it would often appear natut-M and fair for negotiators to allocate a jointly earned sum of m o n e y proportionally, based on the number o f hours worked.
There are certainly cases in which parties do not have a c o m m o n not ion of a fair ou tcome early on in the talks - - for example, because o f different cultural norms or p o w e r asymmetries. Obviously, not ions o f ou t come fairness cannot then serve as instrumental focal points. However, inability to agree on a joint principle o f ou tcome fairness, or a joint interpretation o f it, does not necessarily mean that agreement will be impossible. Instead, parties may agree to:
• use wha t in their eyes is fair p rocedure for arriving at an agreement - - e.g., reciprocation o f comparable concessions or divide-and-choose;
• strike a balance - - "split the difference" - - be tween their compet ing fairness p~Snciples;
• base the ou tcome on the fairness not ion of one o f them (e.g., as a result of the o ther party attaching lesser importance to its fairness principle and/or depending more on an agreement being reached);
• conclude an agreement for reasons other than fairness; or
• move to an integrative m o d e of negotiat ion, in w h i c h divergent fairness notions may be overcome by redefining the problem, or may even provide terms of trade and thus facilitate agreement.
When divergent fairness notions are derived from fundamental values, nego- tiation would, in most cases, be impossible if distributive in outlook and based on positions (Druckman and Zechmeister, 1973). Reaching agreement would then requi re a shift to a p rob lem-so lv ing process . The "pr inc ip led negot ia t ion" approach - - striving to use negotiating procedures and reach outcomes which are "objectively" fair (Fisher and Ury, 1981) - - would seem to be constructive only in such an integrative context w h e n parties' fairness notions are opposing.
One may legitimately question the extent to wh ich there is anything inher- ently fair about the notions of fairness discussed thus far - - both conceptually and in real cases. The opening positions are of crucial importance in distributive negotiations in determining wha t will be viewed as a fair agreement and fair con- cessions. Typically, the question of the justice of these initial positions taken, or any differences b e t w e e n part ies in need or in ent i t lements to the d i sputed resources, are not raised. For the agreement to be genuinely fair, parties' initial posit ions are assumed to be equally "reasonable" or inflated in v iew of their respective payoffs. One suspects that in many cases, the p rominence of a partic- ular fairness not ion comes less f rom any innate moral force, and more from its k n o w n appea l and p o w e r to coo rd ina t e expec ta t ions , forge a g r e e m e n t in ambiguous situations o f multiple alternatives, and legitimize the ou tcome before impor tant const i tuencies (Schelling, 1960). This is partict~arly true for simple notions o f fairness which are usually taken at face value for "impartial justice;' such as split-the-difference and equal shares.
Fairness notions have clearly served these multiple functions in many pre- dominantly distributive negotiations, including disarmament talks (Zartman et
Negotiation Journal July 1993 231
al., forthcoming) and labor-management negotiations. However, one may ques- tion the applicability of these roles of fairness to negotiations about central, ethi- cal questions or those involving multiple, complex issues, many parties and/or disparate conditions, including resource inequalities. In the areas of the global environment and ethnic conflict, for example, parties often seem not to accept ready-made concepts of fairness, or they have divergent fairness notions which they regard as impossible to compromise. Assuming a need for agreement, par- ties would then be led into a search for a unique integration of and balance between their respective norms. The only coordinating force becomes the joint interest in finding a fair solution, in the broadest sense. Any resulting agreement is likely to involve a complex formula which, in the process of negotiating, is far from obvious but at the very core of the negotiations themselves. This brings us to the issue of fairness in integrative negotiations.
Fairness in Integrati~? Negotiations How do concepts of fairness relate to integrative negotiations, the essence of which is the creation of "win-win" solutions which supposedly eliminate the need for compromises? How do the roles they play differ from the roles of fair- ness notions in distributive bargaining?
Integrative models view the task of negotiation as creating or discovering new options which combine divergent interests into an agreement by redefining or modifying them. Two or more issues, or subissues, are under contention; interests are partly overlapping, partly opposing; and the overall process is posi- tive or varying sum in that one party's gain does not entail an equally great (or any) loss for the other. Contrary to the idea of bargaining as a competi t ive process of give-and-take, parties jointly explore concerns at stake, the evalua- tions of which are flexible. Possible options for a solution are generated through such tools as brainstorming, and then analyzed and compared.
In this process, parties reassess ways of meeting their concerns - - includ- ing concerns about fairness. Concessions are made in reference to a particular option or formula for a solution rather than established positions, and only once such a joint referent point has been accepted. The possibilities of gains from agreement are not p r e d e t e r m i n e d but, be ing exp lo red in the negot ia t ion process, depend extensively on parties' own problem-solving efforts and skills (Follett, 1942; Zartman and Berman, 1982). The negotiation is rarely an isolated encounter, for sufficient trust already exists to reveal interests and priorities. ~qaile factors such as power (a)symmetry and time costs may give a sense of the range of likely- outcomes, integrative negotiations are essentially nondeterminis- tic: The outcome is an unpredictable creation reflecting a combination of new values. They tend to produce agreements with high joint gains, provided that parties maintain high aspirations regarding major concerns and do not yield excessively (Pruitt and Lewis, 1975).
When perfectly integrative solutions can indeed be found, fairness judg- ments and issues are seldom invoked simply because parties got everything they" wanted. Still, such solutions establish a kind of fairness between parties by fully meeting the concerns of each based on individual values and utilities, and also frequently rely on the use of "fair" integrative techniques. Most agreements, however, are at best partially integrative - - some trading of concessions and compromises is necessary. In this process, as distributive negotiations focus on methods of division, the integrative approach relies extensively on the concept
232 Cecilia Albin The Role o f Fairness in Negotiation
of exchange: Parties value, or can be brought to value, the same item differently so that each party may, to its mutual gain, trade concessions on its less-valued items for concessions on items it values more. A major task of negotiation then is to bring into the open or create such different valuations, thereby making trad- ing possible. The classic theorem on this topic by sociologist George Homans states: "The more the items at stake can be divided into goods valued more by one party than they cost to the other and goods valued more by the other party than they cost to the first, the greater the chances of successful outcomes." (Homans, 1961: 62).
Apart from the norms of fair behavior discussed earlier (e.g., use of creative skills for the benefit of all parties, supply of truthful information about interests and priorities), fairness concepts in integrative negotiation first play a role in the exploration of possible trades for mutual benefit. Each party then asks itself if a particular exchange is "fair" in what it asks the party to give up and what it offers in return for the sacrifice. The resources being traded are valued differently, and attempts to determine objectively whether the exchanged bundles of goods are equivalent become irrelevant. However, each party must feel that the total of what it receives in the exchange justifies what it is asked to give away (based on its own evaluations). Ideally, each party also genemJly feels that the other party contributed about as much to the exchange, and that it gained about equally from the agreement. Outcomes tend to be viewed as unfair if they leave one party far better off than the other, despite the teaching that a party's own alternative to an agreement is the proper basis for measuring how well it did in a negotiation.
Intuitively, one would think that a joint notion of fairness is required for arriving at a negotiated agreement. In integrative negotiations, however, parties do not value things in the same way and thus have divergent notions of what constitutes fair trades. Indeed, at the heart of the approach is the exploitation of any ". . .differences among negotiating parties - - in what they have and under what conditions they have it, in what they want and when they want it, in what they think is likely and unlikely, in what they are capable of doing, and so forth" (Lax and Sebenius, 1986: 105). These differences may concern interests, priori- ties among issues, resources, attitudes toward risk and the passage of time, and expectations or beliefs.
The proposition that specifically divergent concepts of fairness could pro- vide terms of trade and facilitate agreement in predominantly integrative negotia- tions deserves more testing on actual cases. One illustrative example of a formula for an agreement incorporating divergent fairness concepts which increased joint gains is the 1987 Montreal Protocol on Substances That Deplete the Ozone Layer. For the developing countries, a fair solution must not penalize them for a problem caused essentially by the industrialized world. At the heart of the developing countries' notion of a fair agreement was the principle of need - - of compensating them through technical and Financial assistance and other special provisions for accepting regulation of emissions which could hamper their development. At the core of the North's notion of fairness was equity - - expressed in the proposed reductions in chlorofluorocarbons (CFCs) propor- tionally to each country's emission level, and the foreseen fmal regime accepting the North's much higher emission levels and keeping those of the South low. The equality norm was expressed in the long-term goal of the North and the South sharing the cost of regulation on a basis of parity.
Negotiation Journal July 1993 233
Fairness issues also become prominent when the general terms of the agreed-upon trade are to be implemented in detail. Thus, for every- element of the accord, each party asks itself: Is this a fair interpretation of the terms? Is the substance of the concessions I am demanded to make fair considering the out- come we have in mind? Each party asks itself if, based on its own evaluations of the resources, it receives a "fair share" of the jointly created benefits. At this last stage of the negotiations, notions of fairness serve to coordinate expectations and concessions, as in the distributive approach. The centerpiece of integrative negotiation, however, remains the elaboration of the terms of trade. Parties do not start out with detailed notions of a desirable outcome, but it is the absence (real or perceived) of a single, salient solution viewed as fair that typically moti- vates them to engage in the talks. This makes the task of jointly determining the fairness norms which underlie an agreement a significant part of the negotia- tions themselves. Any initial concepts of a fair outcome are modified and sharp- ened in the process of reframing the problem and exploring new options. While the problem is already defined by the time distributive negotiations get under way, the reformulation of issues and alternatives in integrative bargaining gives rise to new definitions or measurements of fairness.
P r o c e d u r a l F a i r n e s s
Procedural fairness concerns specific mechanisms used for arriving at an agree- ment. 1 These mechanisms are considered fair because of some intrinsic value (e.g., they give parties an equal chance to "win" or demand equal concessions from them), because they tend to produce fair outcomes, or because of both of these qualities. Thus procedural fairness concerns the features of the mecha- nisms themselves, while process fairness refers to larger issues, such as how the mechanisms are actually used in the negotiation process (e.g., if in good faith, without bluffing) and the substance of parties' concessions.
Fair procedures may be diffuse and difficult to observe, such as reciproca- tion, or more clearly defined and manifest, such as tossing a coin and divide-and- choose. They may be determined prior to the talks, and considered part of the established "rules of the game" and overall structure of the negotiations. For example, the reciprocity norm is incorporated in the General Agreement on Tar- iffs and Trade (GATT), which provides much of the structure for negotiations over trade liberalization. It permits protectionist measures against countries which subsidize their exports or engage in other trade practices deemed unfair, and holds that a cut in any comatry's import tariffs should be balanced fairly with equivalent foreign tariff cuts. Distributive procedures may be distinguished from integrative procedures. Particularly in complex negotiations involving multiple issues and parties, procedures of both kinds are used. 2
Distributive Procedures
ReciprociO~ Many fair procedures serve as mechanisms which govern the exchange of con- cessions leading to a division of a limited bundle of goods. Oftcn, these mecha- nisms are based on variations of the principle of reciprocity, arid tend to be used when parties view themselves as equal in power, recognize a mutually promi- nent solution, and/or foresee an agreement based on equality. They include "equal concessions;' in which comparable concessions are exchanged in refer-
234 Cecilia Albin The Role o f Fairness in Negotiation
ence to initial positions; "equal sacrifices," where parties make concessions cans- ing them to stiffer equally; "tit-for-tat, in which a party matches the otheFs move in substance and scope, thus responding to toughness (softness) with the same toughness (softness); "responsiveness to trend;' where each party makes conces- sions based on its evaluation of a series of moves by the other side; "comparative responsiveness" in which each party acts based on a comparison of its own and the other's tendencies to concede 0)ruckman and Bonoma, 1976); and "asyan- metrical concessions" whereby a presumably weaker party responds to the other's concessions with relatively larger sacrifices. Laboratory experiments and actual case studies demonstrate that these procedures - - the equal concessions norm in particular - - are common patterns of concession-making and, more generally, that requests for fairness play an important role in negotiations (Ben- ton and Druckman, 1973; Druckman and Harris, 1990).
Reciprocity procedures are perceived as fair because they supposedly lead to a fair outcome. For example, when parties foresee or favor a split-the-differ- ence agreement, equal concessions tend to be exchanged. But even in the absence of agreement on a predicted outcome, the reciprocity norm is widely regarded as intrinsically fair (Ik16, 1964) - - even as "one of the universal 'princi- pal components ' of moral codes" (Gouidner, 1960: 161). Reciprocity, however, is not necessarily the impartial procedure it is so often portrayed to be. This is par- ticularly true about reciprocity interpreted as equality (equal concessions). As noted earlier, the exchange of equal concessions will lead to a fair (equal-split) outcome only when parties' inffial positions are equally far from their respective security points, and the problem of partisan biases is avoided.
Fair-Chance Procedures Another major category of distributive procedures grant parties a fair (often equal) chance to win the disputed resource, or be relieved of it in the case of a burden. These "fair-chance" procedures are typically games with clearly defined rules, codified interaction, and a fixed set of possible (known) outcomes? They do not involve negotiation in the sense that concessions are exchanged or diver- gent interests reconciled; instead, the outcome typically consists of a winner and a loser as in, for example, arbitration procedures. After the fact, even if recogniz- ing that its chance to win was fair, the losing party will rarely feel that the out- c o m e is fair. Thus, i m p l e m e n t a t i o n o f the o u t c o m e of ten d e p e n d s on enforcement mechanisms.
These kinds of procedures are often used when patxies cannot agree on a fair solution; when no solution can be quite fair (e.g., the allocation of a mission involving high risks of death); when a solution is needed quickly.; when the stakes are relatively low so that it is not worth using a more time-consuming pro- cedure; when the stakes are so high that full-fledged bargaining would seem inappropriate or involve too many pressures and pain; and when the greater ambiguity or manipulability of other procedures are to be avoided.
Some procedures are "random methods" - - e.g., tossing a die, flipping a coin, or arranging a lottery. They usually reflect fairness understood specifically as equality: Initial equal entitlements to the resources and no (or equal) informa- tion about the other's evaluations are assumed, and parties are given an equal chance to win. However, the odds of winning can often be construed to reflect divergent initial rights and other fairness norms. While perhaps appearing as too crude to apply but to trivial disputes, random procedures are recommended and
Negotiation Journal July 1993 235
used in significant political and social contexts. Indeed, they are often viewed as fair when the outcome is either of very small or very great importance to parties (Eckhoff, 1974), or the disputed resource/burden is indivisible. For example, lot- tery systems are employed for distributing dangerous tasks in the military. Their use has also been recommended to decide which sites among qualified candi- dates are to be exempted from further consideration in the siting of hazardous facilities (Kasperson, Den" and Kates, 1983) and to settle indeterminate child-cus- tody disputes fairly to avoid the emotional harm to children of lengthy litigation and negotiation (Elster, 1989). Random procedures often fail to make parties with divergent evaluations end up with what they value the most, or with some- thing which roughly corresponds to their initial entitlements to the resources when these are unequal. Nor do such winner-takes-all solutions foster long-term good relations be tween parties, particularly not w h e n they value the goods highly. Yet randomization can be used to establish initial ownership, and then be followed by bargaining which may reduce or even eliminate such negative side effects (Raiffa, 1982).
Another type of procedure is to arrange an "auction" to determine which par ty values the d isputed resources the mos t (Young, for thcoming) . The resources would be given to the highest bidder, with the possibility of compen- sating the other party in some form. While appearing at first as a dynamic trans- lation of the principle of equity (proportionality), the procedure is not always a good means to compare parties' evaluations. Uneven knowledge between par- ties of their respective values opens the possibility of strategic bidding. Further, auctions measure bo th the ability and willingness to pay. Thus they cannot assess fairly the worth attached to a good when parties differ in their capacity to pay what they are actually willing to pay. Yet an auction procedure has been used successfully in the siting of hazardous facilities among voltmteer commtmi- ties, based on their proposals for "fair" compensation packages (Susskind, 1990).
Still another procedure is "divide-and-choose" It refers to the old custom of how to deal with two children fighting over a cake they both want. Their par- ents decide that one of them will cut the cake and then the other will choose the first piece, thus inducing the child cutting the cake to do so fairly. The mech- anism was used successfully in the complex Law of the Sea negotiations to deter- mine the al locat ion of mining sites in the deep seabed (Sebenius, 1984). Resources at stake are normally assumed perfectly divisible and similarly valued; or, if valued differently, that parties have no information about each other's pref- erences. If valuations are divergent and the party doing the cutting knows the other's preferences, R will often be able to divide in a way that gives itself the larger share. 4 Like other distributive procedures, divide-and-choose may solve the problem of fair division mad also achieve a state of "superfairness" (see discus- sion below). However, the technique fails to exploit any differences in prefer- ences to parties' mutual benefit.
A variation on divide-and-choose is to negotiate a division before knowing or deciding which part each party will have 0iawls, 1971). It is inadequate in measuring interests and divergences among valuations, and often fails to pro- duce a solution of high joint gains. The so-called theory of intergenerational equity endorses the procedure for determining the rights and obligations of cur- rent vs. future generations in the environmental area (Weiss, 1989), but fails to take into account that future and current generations' evaluations of important
236 Cecilia AIbtn The Role o f Fairness in Negotiation
resources may not be the same due to technological developments. Another context for which this procedure is recommended is child custody negotiations. Yet parents ' preferences regarding the tradeoffs between child-rearing responsi- bilities and money-related issues vary frequently so as to permit mutually benefi- cial linkages: One paren t will of ten be ready to exchange some custodial responsibilities for concessions on other issues, such as matters of alimony and marital proper ty (Mnookin and Kornhauser, 1979). Such integrative solutions, which fair-chance procedures rarely can produce, increase all parties' gains and self-interests in implementing them.
Integrative Procedures The fairness issues raised by integrative procedures are subtle and difficult to define. Yet they have an intrinsic value of fairness in seeking to elicit balanced, truthful information about core concerns underlying stated positions, and/or in producing new options which can better meet all parties' essential concerns. When used successfully, integrative procedures also tend to bring about fair out- comes by virtue of satisfying all vital interests involved, although parties do not necessarily gain to the same extent.
One group of integrative procedures consists of more-or-less structured approaches for improving communication and trust between parties, changing their zero-stun perceptions of the conflict, and building confidence in the possi- bility of mutually satisfactory solutions. Examples are "controlled communica- tion" and "problem-solving workshops" (Burton, 1969; Kelman, 1972), and the introduction of "superordinate goals" (Sherif, 1958). The second group consists of specific techniques for reframing conflict situations and creating solutions of high joint benefit. They include "expanding the pie," linkage of issues, and compensa- tion (Pruitt and Rubin, 1986); functional strategies (Albin, 1991); "dovetailing" (Fisher and Ury, 1981); and formula construction (Zartman and Berman, 1982). The formula not only serves as a framework for the substance of a fair outcome, but also as a procedure for increasing joint gains mad allocating them fairly.
A classic work on negotiation stresses how that the criteria whereby nego- tiators evaluate what trades are "equitable" and what compromises are "fair" are only perceptions and beliefs which are "continually modified by the bargaining p roces s . . . [ I ] t is the negotiation that develops and changes them" Ok16, 1964: 167). In many conflicts and negotiations, parties' fairness norms are opposing and apparently irreconcilable. Integrative procedures aim at making parties reframe their definitions of the conflict - - including notions of the fairness issues at stake - - so as to become conducive to a mutually acceptable and prof- itable solution. Thus parties' concepts of fairness become an integral part of the negotiations themselves. Current research is exploring the central questions, until now neglected, of how fairness concepts may be negotiated (Zartman et al., forthcoming) and how negotiations in which parties remain committed to opposing fairness notions may succeed in producing agreement by use of inte- grative techniques (Albin, 1992).
O u t c o m e F a i r n e s s
Outcome fairness refers to the principles underlying the allocation (exchange or division) of benefits and burdens in negotiated agreements, and the extent to which parties actually consider that allocation fair after the fact.
Negotiation Journal July 1993 237
Fairness Principles Underlying Negotiated Agreements Three major principles will be discussed, with brief references to ethnic conflict in which outcome fairness issues figure prominently: equity, equality, and need (Deutsch, 1975).
Equity. Originating in Aristotle's notion of justice as rooted in "balance" and "proportion" the equity principle holds that resources (rewards) shouid be distributed proportionally to relevant contributions (inputs). Fairness is achieved when each party's ratio of inputs to rewards is the same, and injustice is experi- enced in relation to these ratios rather than in absolute terms. Relevant contribu- tions may be qualities and endowment s (e.g., status, power, skills, wealth, intelligence), or actions and efforts (e.g., hours worked, tasks completed, leader- ship exercised). In Homans' (1961) notion, fair division is accomplished when net rewards (goods received in an exchange; i.e., money) are allocated in direct proportion to investments (contributions to the exchange; i.e., time spent, risks taken), so that the ratio of profit to investment is the same for everyone. Similar concepts of equity are found in Adams (1965) and Walster, Walster and Berscheid (1978). The "oppor tuni t ies norm," according to which each par ty receives resources proportionally to how efficiently it can use or benefit from them, can be viewed as a variation of the equity principle.
Although frequently applied in negotiations, the equity principle is proba- bly the most ambiguous: The nature of relevant inputs and means to measure their relative value, and the worth of the resources to be distributed and the proper proportionality between inputs and rewards, must be agreed upon. In ethnic conflicts, it is a widely recognized standard of fair distribution (Lijphart, 1990), at the center of many schemes for managing or resolving such disputes (Nordlinger, 1972). These schemes allocate valued resources - - e.g., governmen- tal powers, autonomy, access to education, and higher public service jobs - - between ethnic groups roughly in proportion to their size.
Equality. The principle of equality, also termed "impartial justice:' holds that parties should receive the same or comparable rewards, irrespective of their contributions or needs. The norm finds its origins in the Enlightenment and the philosophy of Jean-Jacques Rousseau, which regarded individual differences as environmental products and equal treatment of all people as the natural and pre- ferred type of human relationships. A common explanation of the reliance on the equality principle in negotiations is its intrinsic appeal and relative lack of ambiguity. Yet it often poses problems of determining what is to be treated equally; h o w to apply it to indivisible or heterogeneous goods; and how to assure an outcome of actual equality when parties are very unequal in some respect. Thus specific interpretations of the principle have been put forward. "Equal shares" divides resources in equal amounts between parties. "Compro- mise 'in the middle '" splits the difference be tween parties ' initial positions (yielding a different outcome than equal shares unless opening positions are identical). "Equal excess" allocates resources to each party corresponding to the value of its best alternative to a negotiated agreement, plus half of the remaining resources (Komorita and Kravitz, 1979). The "equal sacrifice" norm holds that parties' concessions should make them suffer equally (Pruitt, 1981), of which "subtractive justice" denying every party possession of the disputed resources
238 Cecilia Albin The Role o f Fairness in Negotiation
could be viewed as a special case. The ultimate example of equality as outcome fairness in ethnic conflict is the division of sovereignty and territory, in that both or all groups achieve s ta tehood wi th the contro l over vital funct ions and resources that it entails, irrespective of their size or other considerations.
Need. A third major principle of outcome fairness is need, also termed compensatory or redistributive justice. This principle stipulates that resources should be allocated proportionally based on the strength of need alone, so that the least endowed party gets the greatest share. Thus the norm sees no fairness in proportionality between contributions and gains, which rewards the already well-endowed, but in the redistribution of resources in favor of an order based on equality. According to Rawls (1971), resources important to achieve welfare such as liberty, education, and financial assets should be distributed to maximize the weU-being of the weakest or poorest. While posing challenges of identifying, measuring and comparing relevant wants, the needs principle is relatively unam- biguous. The range of potentially relevant needs is usually more limited than attributes which could be considered pertinent contributions. The needs stan- dard formed the basis of, for example, the United Nations negotiations on a New Economic Order and the European Economic Commtmity's talks on the Com- mon Agricultural Policy. In ethnic disputes, a wise redistribution of resources such as wealth, income, and employment disproportionally in favor of any disad- vantaged group may constitute an effective tool of conflict management, particu- larly at an early stage when demands for partition or sharing of central powers are not yet made or very strong, as demonstrated by the case of Malaysia 0~sman, t990).
Other principles of outcome fairness include "precedent" whereby a previ- ous comparable decision serves as the rule for determining allocations and thus encourages parties not to go below what has been agreed to date, as is common in labor-management negotiations over wages; "retribution" whereby a party guilty of violating some rule in the past is punished by getting less; and "no- envy" or "superfaimess" ~oley, 1967; Baumol, 1987) which, in holding that a cer- tain allocation is fair only if no party prefers the other's share of resources to its own, is unusual in accounting for preferences for the disputed resources. "The other's share" would usually refer to a party's share of the disputed goods rather than the totality of its endowments.
Factors Influencing the Choice o f Outcome Fairness Principle Factors such as age, status, gender, type of relationship between parties, goals, culture, and type of issue(s) may influence percept ions of fairness, and the choice and particular interpretation of fairness principles, in the settlement of distributive issues. According to Piaget (1932), children move through the stages of endorsing strict equity (accounting for inputs only), strict equality (disregard- ing inputs), and lastly, "mature equity" (accounting for circumstances as well as individual inputs). Relatively strong parties appear to favor equity and weaker parties equality, and women and men equality and equity respectively (Sampson, 1975). Further, need is a predominant standard of outcome fairness in intimate relationships or interpersonal negotiations when individual weffare is a common goal; equality, when good long-term relations or solidarity are valued; and equity, when economic productivity is the primary concern as in many professional-
Negotiation Journal July 1993 239
labor contexts in Western countries (Deutsch, 1975). A key question still unan- swered is the relative importance of each factor - - e.g., which norm would pre- vail when American women negotiate as close friends.
Outcome Fairness as a Balance Between Competing Principles The principles reviewed often pose questions of interpretation and operational- ization. Thus negotiations often revolve around reaching agreement on the appli- cation, as much as the choice, of the principle(s) to guide the resource allocation, Furthermore, outcome fairness in many contexts must involve a bal- ance between a combination of principles, all of which may appear equally applicable, which accounts for a wider range of factors and circumstances than any single norm can do.
Many cases suggest that the more complex the situation - - e.g., in involv- ing high stakes, needs or contributions which are difficult to compare, wide dif- ferences in dependency on agreement among parties - - the greater the number of principles which has to be included and weighed carefully against each other. The Montreal Protocol on Substances That Deplete the Ozone Layer was based on a combination of fairness standards to account for signatory states' varied conditions. A proposed scheme for a global warming agreement strikes a bal- ance between the status quo and absolute equality, in stipulating greenhouse gas emission reductions which impose about equal hardship on the developed and developing cotmtries, with the long-term objective of establishing an egalitarian regime. Compensatory justice is reflected in its suggestion for technological and financial aid to developing countries to facilitate their adjustment to the regime (Young and Wolf, 1992). Thus the proposal balances a number of considerations - - including differences in responsibility for the global warming problem, in cur- rent emission levels, and in ability to bear the costs of regulation. In the search for solutions to many ethnic disputes, the need for imaginative formulas which combine a number of principles rather than rely on a single norm is obvious.
Fairness af ter the Agreement Agreements viewed as fair at their conclusion have a better chance of enduring than outcomes resulting from a mere confrontation of skill and power in negoti- ations. Yet the norms underlying an agreement do not necessarily represent an "end-state" form of fairness or the final product of the talks: The provisions may not be viewed as fair in the longer term, after an agreement has been concluded, but require renegotiation and adjustment. Outcome fairness thus concerns not only the principles tmderlying an agreement, but also the extent to which par- ties consider it legitimate in the short and long term in actually fulfilling the expectations of fairness they harbored at its conclusion. This evaluation directly affects the prospects of the agreement being ratified and implemented, any post- agreement negotiations undertaken to adjust it, and its duration.
Actors such as domestic constituencies and nongovernmental organiza- tions may provide a new perspective on the agreement which makes it appear unfair after its conclusion - - e.g., its effects on parties which were not repre- sented in the negotiations, the openness of its operation to public scrutiny, changes in its distribution of benefits and costs among parties due to unforeseen developments, and the effectiveness of mechanisms for monitoring adherence and dealing with violations. A revelation that a party "cheated" (e.g., provided
240 Cecilia Albin The Role o f Fairness in Negotiation
false information) at some point in the negotiation of or compliance with an agreement may lead others to repudiate it. The nse of non-tariff barriers to trade is widely recognized as violating principles of free trade under the General Agreement on Tariffs and Trade (GATI0 and leading to unfair competition. In response to increased use of such barriers, new negotiations have been under- taken to reduce them. An agreement may also become unfair because of outside actors, who refuse to sign it to avoid the costs involved and yet cannot be pre- vented from enjoying the same benefits as participating countries. The costs may be so disproportionally paid by a few to the benefit of many- others that the tong-term durability of the agreement depends extensively on reducing such "free rider" phenomena. In other instances, noncooperative actors can make international agreements - - e.g., on the mmaagement of the Global Commons, such as the protection of endangered species - - unfair by impeding the achieve- ment of their goals and thus imposing costs not only on signatory states but the entire world community.
For any or a combination of these reasons, an agreement may be viewed as unfair after its conclusion and require renegotiation to restore fairness and acceptability. New actors may" have to be included in the process, the allocation of benefits and burdens between parties may have to be adjusted, and more flex- ibility may have to be built into the agreement to maintain its fairness over time with changing conditions. In such a post-agreement negotiation process, the principles underlying an accord may be reinterpreted or applied in new ways, or replaced by other norms.
S u m m a r y a n d C o n c l u s i o n
This article has analyzed four classes of fairness issues, all of which affect the process and outcome of negotiations under different conditions. It has proposed that when a common notion of outcome fairness exists at an early stage in the talks, that notion will tend to coordinate concessions and facilitate agreement. When parties are entrenched in opposing notions of fairness, a solution may still be reached. In integrative negotiations, divergent concepts of fairness become part of the bargaining itself, and may help to provide terms of trade. A fair out- come in many real-world situations cannot rely on a single norm, but only on a balance between a number of principles. A concluded agreement may become viewed as unfair and thus cam for renegotiation.
Relationships between types of fairness are also significant. For example, most procedures will be considered fair only as related to specific situations - - notably particular outcomes which parties have in mind. Thus equal concessions tend to be exchanged when an outcome based on equality is foreseen. In cases of disagreement on the substance of a fair solution, parties may resort to a process or procedures seen as intrinsically fair in some respect, given the nature of the disputed resources and cultural norms. Lotteries may be used in the United States to help determine sites for hazardous facilities fairly, but few Israelis or Arabs would agree to toss a coin to settle the issue of Jerusalem's polit- ical status. The fairness of a particular outcome is frequently equalized with the fairness of the process by which it was produced. As noted, however, fair processes or procedures do not always lead to solutions viewed as fair nor does outcome fairness necessarily result from process fairness. When parties can agree on a fair solution, a case may be made for employing a process which best
Negotiation Journal July 1993 241
guarantees its achievement rather than satisfies criteria of fairness. Thus process and procedural fairness is normally only one determinant of outcome fairness. Others may include cultural factors, pat~ies' status and relationship, and types of issues negotiated.
As analysts or practitioners, we should beware of single-factor models and explanations. Negotiations are not driven by requests for fairness alone. Nor is there, for sure, a single universal concep t or application of fairness which reflects itself in negotiations. Notions of fairness are extremely diverse and vary with the context. But in response to the introductory question, on what (if any) role notions of fairness play in negotiations, it must be concluded that the issue is not whether but how they have an impact. Opposing fairness notions figure prominently today in numerous environmental and ethnic disputes, the manage- ment and resolution of which will depend extensively on successful negotiation in the coming years. In many such disputes, attempts to produce a common fair- ness notion, strike a compromise between competing norms, or reach agree- ment without basing it on fairness will prove futile. Thus successful negotiation may depend on the use of integrative techniques which redefine the problem, accept, mad even exploit differences.
Numerous angles of the subject remain to be explored - - among them, tac- tical uses of fairness, fairness in post-agreement negotiations, any differences in the stability of outcomes which are based on different fairness principles, and fairness in relation to other key factors which affect the process and outcome of negotiation such as power and culture. Experimental findings on other aspects remain to be tested on actual cases. Research along these lines promises to yield new insights which will help us to better understand the science and the art called negotiation and, foremost, many ongoing and upcoming negotiations of global significance.
NOTES
An earlier version of this article, including a detailed literature review, appeared as C. Atbin (t992) "Fairness Issues in Negotiation: Structure, Process, Procedures, and Outcome." Working Paper WP- 92-88. Laxenburg, Austria: Processes of International Negotiation (PIN) Project, International Insti- tute for Applied Systems Analysis (IIASA). I am grateful to Jeffrey Z. Rubin and Bertram I. Spector in particular for valuable comments, and to the PIN Project and IIASA for supporting this work.
1. This is a narrower definition than that typically found in the literature, which uses the terms "procedural" and "process" fairness interchangeably to refer to the fairness of the negotia- tion process generally.
2. One well-known example is the Law of the Sea negotiations (see Sebenius, 1984). 3. For more on such procedures, see Brams (1990), Prasnikar and Roth (1992), and R~aiffa
(1982) regarding game theoretical notions of the role of fairness and fair procedures in nego- tiations.
4. The advantages of being the divider could be neutralized and thus the procedure made fairer. Divide-and-choose could be used to allocate indivisible goods, ff a sufficient amount of divis- ible resources are added (Crawford and Heller, 1979).
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