Being the toughest negotiator in the room can actually make you end up with the worst deal.
April 15, 2026
Original Paper
Reputational Spillovers
arXiv · 2604.08616
The Takeaway
The classic advice is to be uncompromising and 'tough' to win a negotiation. This paper shows that in the real world—where you are often negotiating with multiple people at once—this backfires. If you develop a reputation for being a hardball player, your other partners will change their behavior to protect themselves, eventually leaving you worse off than if you had been flexible. The 'spillover' of your reputation actually poisons the well for your future deals. It turns out that being 'too strong' makes you a target, not a winner.
From the abstract
We analyze a reputational bargaining game in which a central player negotiates simultaneously with two peripheral players. Each player is either rational or a commitment type who never concedes and insists on a fixed share, and concessions are publicly observed. The central player's type is global, so actions in one dispute update beliefs in the other and generate reputational spillovers. The game admits a unique equilibrium, enabling a sharp comparison with the bilateral benchmark of Abreu and