Collaborative environmental negotiation with private non-verifiable information: an experimental test

In many cases, governments invite interest groups to use collaborative negotiation to resolve environmental conflicts. A characteristic of these negotiations is that the parties lack ex ante information about their opponents' ordinal and cardinal preferences. We argue in this paper that most laboratory experiments that have investigated the outcomes of collaborative negotiation have not taken this information asymmetry into account fully. In this paper, we introduce private information into an experimental protocol that we originally employed to investigate collaborative negotiation with full information. We hypothesise that making information private will have only a limited effect on subjects' abilities to reach Pareto-efficient bargains or on the effect that entitlements will have on the outcome; but that considerations of equity will become less important. We find evidence to support these hypotheses, though the effect of entitlements seems more robust under private than full information.