Heuristic Theory and Contrast Effects

Mediator Blah, Blah is a consistently delightful blog for mediators, yet often very substantive. In its posting on Heuristic theory it mentions “in passing the need to understand common heuristic theory such as – anchoring and adjustment, availability, self-serving evaluations, framing, status quo bias, contrast effects, and reactive devaluation.”

Mediator Blah, Blah is a consistently delightful blog for mediators, yet often very substantive. In its posting on Heuristic theory it mentions “in passing the need to understand common heuristic theory such as – anchoring and adjustment, availability, self-serving evaluations, framing, status quo bias, contrast effects, and reactive devaluation.”
“In particular, contrast effects is interesting as a ‘persuasion tool’ and appears useful, especially if you are the kind of trigger happy mediator who puts forward mediator proposals at the drop of a hat (shame on you!).
An example of contrast effects might be:
A mediator proposal (or party offer) of $100,000 paid in –
1. two tranches on anniversary of settlement – $50,000 per year for two years, or
2. a lump sum today but NPV’ed (net present valued) over 2 years, or
3. monthly installments over 3 years starting next month
Research shows the recipient will likely take each of the options offered to them then compare it to the other payment options rather than comparing the $100,000 to their wish figure and wanting more.
This research has developed several interesting ways of using our knowledge of biases to influence party thinking….
But where’s the line for us mediators on this stuff?”
Well, there is a line for mediators, but the theory and research are important for the advocates to know, so thanks to Geoff Sharp for all the online tutorials he cares to post.

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