John DeGroote at Settlement Perspectives makes a connection that I hadn’t made — that the Curse of Knowledge might be a barrier to successful negotiations, because it leads us to believe (falsely)that our “subtle” signals are being received correctly by the other party:
At some point in almost every negotiation we are tempted to use our actions to send a message – a customer hoping to “get tough” demands the supplier come to her office; a home purchaser makes a “low ball” offer to signal that the house is priced too high; and a policyholder reduces his claim in an effort to “split the difference” with his insurance adjuster. Unfortunately the other side often perceives something very different: the supplier walks in assuming he is about to be introduced to more of his customer’s employees to expand the relationship; the home seller believes the purchaser isn’t serious; and the adjuster perceives its policyholder is willing to continue negotiating from a compromised position.
