Why Scepticism, Not Blind Trust, Can Lead to Better Business Deals

Why It Matters

Executives often assume that showing trust is the key to successful negotiations. But new research reveals that in first-time, high-stakes business dealings, a shared dose of scepticism may be more effective than blind trust.

Key Takeaways

• Negotiation pairs low in trust propensity achieved higher joint gains by making smarter trade-offs.
• Shared scepticism encouraged rigorous questioning and fewer assumptions, creating 15% more value than simply trusting the other party.
• Constructive scepticism is especially useful in first-time negotiations with unfamiliar counterparts.

Testing Scepticism Against Trust in Real Negotiations

To test how trust and scepticism affect business negotiations, researchers studied 160 MBA students in India. Participants were paired up and assigned roles: one acted as a job recruiter, the other as a candidate. Each pair negotiated across eight issues simultaneously, including salary, vacation days, start dates, and job location.

Before the negotiations began, the participants completed surveys that measured their general tendency to trust others. The survey included statements such as “I believe most people are well-intentioned” and “Most people will take advantage of you if you let them.” This helped researchers classify participants as high or low in trust propensity.

The experiment was designed to mimic real business negotiations. Some issues involved trade-offs where parties valued different things. Others were zero-sum, where one side’s gain meant the other’s loss. A third set of issues involved compatible interests, where both sides wanted the same outcome. This allowed researchers to see how trust influenced different negotiation contexts.

How Constructive Scepticism Drives Value Creation

The most striking results emerged when both negotiators scored low on trust propensity. These sceptical pairs consistently created the highest joint value. They were better at spotting opportunities for trade-offs and at finding creative solutions compared to high-trust or mismatched pairs.

This advantage came from what the researchers call “constructive scepticism.” Instead of accepting claims at face value, both sides pressed for clarity, questioned assumptions, and pushed for evidence. They probed into underlying interests and resisted rushing to agreement. This approach led to a deeper understanding of each other’s true priorities and to innovative solutions that benefited both parties.

On average, sceptical pairs generated about 15% more value than trusting or mismatched ones. Their questioning approach, far from stalling the negotiation, allowed them to uncover options that would have remained hidden if they had relied purely on trust.

When Trust Helps and When It Hurts

The research also shows that the role of trust depends on the type of negotiation. In purely competitive, zero-sum situations, trust had little impact. These scenarios depend more on strategy than on interpersonal dynamics.

However, when interests were naturally aligned, high-trust pairs also performed well. Trust helped them coordinate smoothly and quickly agree on shared priorities. By contrast, moderate trust proved the least effective across all contexts. Negotiators with a halfway trusting approach often misread cues, missed opportunities, or failed to coordinate effectively.

The key insight is that alignment of approach matters more than absolute trust levels. Both consistent scepticism and consistent trust can outperform inconsistent or lukewarm approaches.

Business Implications

The findings challenge the common belief that more trust always leads to better business outcomes. In fact, for one-off, high-stakes negotiations, such as mergers, acquisitions, or large contracts, shared scepticism may be the smarter strategy.

Executives negotiating with unfamiliar counterparts may benefit from asking more questions, testing assumptions, and holding off on premature agreement. By encouraging rigorous exploration of all options, they can unlock hidden value and reach more creative deals.

The study also suggests that organisations should train negotiation teams to recognise the type of issues at stake. For familiar partners in long-term relationships, trust and relationship-building remain critical. But for new or complex negotiations, constructive scepticism can be a powerful tool.

For firms, the message is clear: scepticism is not the enemy of collaboration. When used constructively, it can help negotiators uncover richer opportunities, create more innovative solutions, and ultimately strike better deals.

Authors & Sources

Authors: Ruchi Sinha (Nanyang Technological University), Sudeep Sharma (University of Illinois Springfield), and Hillary Anger Elfenbein (Washington University).

Original article: Journal of Business and Psychology