Reservation Prices, Resistance Points, and BATNAs: Determining the Parameters of Acceptable Negotiated Outcomes

During the 1980s, bargaining and negotiation garnered considerable attention from researchers and practitioners in a number of different academic disciplines and professions. Much of the research and writing was directed toward improving the effectiveness of negotiators through case studies, theory development, and empirical research. Because a number of authors addressed this issue, one resulting difficulty is frequent confusion among other writers and their students in the translation of theoretical and empirical concepts. One particular source of confusion is the distinction among reservation prices (Raiffa, 1982), resistance points (Walton and McKersie, 1965), and BATNAs (Fisher and Ury, 1981). The terms are often used interchangeably by negotiation scholars, and on the surface, they seem very similar. They all represent the notion of a lower bound, beyond which the negotiator will not settle. For negotiators in a selling role, that bound translates into the lowest price that is acceptable. For negotiators in a buying role, it represents the highest price that is acceptable. In this article, we argue that, in fact, the concepts are different and that they represent three separate lower bound points that are salient to the focal negotiator at different points in the negotiation. As a starting point, we turn to the original athors of each of these terms for definitions and examples.