Negotiation strategy

I want to talk about negotiation today, as Britain is planning to trigger Article 50 to leave the European Union by the end of March. I think that we can model a negotiation process as a similar process of firms setting their prices in an oligopoly market, as negotiation has many similar characteristics as an oligopoly market that negotiation has limited participants and these participants can set their own prices in order to maximise their own profits and the prices will all contribute to affect the final outcomes.

Under an optimal situation, if all participants have very transparent demands, it is easy for all participants to work out an outcome that maximise the mutual profits. However, usually these demands are not transparent and some participants even intentionally hide their demands from others because their demands are very complicated and have multiply targets. In addition, sometimes hiding oneself's own interest can help the individual to further maximise its individual profits by taking advantage of information asymmetry. Once participants are facing information asymmetry, they tend to build up an environment of imperfect information symmetry that all participants are showing their partial interests. Under such situation, it is hard to say which participant is taking advantage of imperfect information, it is even difficult to justify if the final outcome is necessarily not better than the outcome under a perfect information situation. Because negotiations can be repeated between two participants over and over again, though each time the negotiation would focus on a different topic, the participant's individual interest can be unchanged while the other one could take advantage of the known information as it can stand in a much different position in the different topic.

Therefore, the negotiation between countries are always and continue to be imperfect information symmetry because countries' preferences are unique, stable and complicated that force countries to stand in different positions when talking about different issues.