BazermanMoore

Overestimating Your Value in Negotiation 173
to be insulted by the offers, Harrington, his parents, and Tanzer rejected each one—
despite the fact that these figures were typical for a seventh-pick player. The tough
negotiations extended for months before breaking down. Harrington could not play for
a major-league team that year or for any of the high-level minor-league teams. He
headed for the independent-league St. Paul Saints and hoped for a more successful
negotiation the following year.
Harrington had a disappointing season with the Saints, but secured a new agent,
Scott Boras, for the 2001 major-league draft. The San Diego Padres chose him as the
58th overall selection. This time, Harrington turned down an offer of $1.25 million over
four years with a $300,000 signing bonus. The next year, 2002, Harrington was the
374th pick. He was offered (and refused) less than $100,000 from the Tampa Bay Devil
Rays. In 2003, the Cincinnati Reds drafted him in the 24th round at number 711, but
again talks fell through.
By this point, Harrington had become the longest holdout in baseball history, but
his saga was not over. In 2004, the New York Yankees drafted him in the 36th round—
he was player number 1,089—but did not make him a contract offer. None of the thirty
MLB teams drafted Harrington in the fifty rounds of the 2005 draft. This made
Harrington a free agent who could sign with any team that was interested in him. In
October 2006, the Chicago Cubs signed Harrington to a minor-league contract. He
was invited to spring training with the hope of finally entering the Majors, but with no
guaranteed payment. Harrington showed up to training camp, only to be released
(fired) by the Cubs before the start of the 2007 season. He returned to the St. Paul
Saints, his original independent-league team, who released him in June 2007.
In negotiation, it is useful to know when to hold out for a better outcome. At some
point, however, wise negotiators know when it’s time to accept the deal on the table.
Year after year, Harrington, his parents, and his agents made a simple but critical mistake:
they forgot to say yes. Harrington’s BATNA was risky at best, terrible at worst. Yet
even with professional negotiators representing him, his overconfidence destroyed a
tremendous amount of potential.
Overestimating the chances that the other side will give you what you want can be
a devastating negotiation error. Matt Harrington’s story is extreme, but all kinds of job
seekers overestimate what the other side will pay. More broadly, negotiators who overestimate
their value and consequently fail to reach agreement waste tremendous
opportunities.
Research demonstrates that negotiators tend to overestimate the chances that their
positions will prevail if they do not ‘‘give in.’’ Similarly, negotiators in final-offer arbitration
consistently overestimate the probability that their final offers will be accepted
(Bazerman & Neale, 1982). (Each of the parties in final-offer arbitration submits a
‘‘final offer’’ to an arbitrator, who must pick one of them. Unlike a judge or a mediator,
the arbitrator cannot make another proposal.) In laboratory studies where there was, on
average, only a 50 percent chance of a final offer being accepted, the average individual
nonetheless estimated that there was a much higher probability (68 percent) that his or
her offer would be accepted.
Negotiators who overestimate their value may miss out on a variety of settlements,
despite the existence of a positive bargaining zone. Negotiators who are able to make