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The purpose of this study is to predict cooperation in negotiation through the lens of individual differences. Specifically, this paper examines how a social competence variable called “political skill” relates to cooperation and subsequent effects on negotiation process, outcomes and negotiator reputation. The authors demonstrate how political skill fits in the evolving literature focusing on individual differences in negotiation by comparing political skill to a wide range of other individual difference measures.

This study was conducted by assessing individual difference measures at the beginning of graduate-level negotiation courses and tracking negotiation behaviors and outcomes over several months. This approach was chosen to minimize the potential for short, time-limited interactions to mask existing relationships. It also allowed the authors to include multiple negotiation interactions, which takes a broader view of negotiation performance, and assess negotiator reputation by allowing it to emerge over time.

The results of this study show that political skill, self-rated at the beginning of this study, is significantly related to a negotiator’s overall use of cooperative behavior as rated by peers. Political skill also showed a significant relationship with reputation for cooperativeness and aggregate outcomes in negotiations. These results control for other individual difference measures such as personality, implicit negotiation beliefs, social value orientation and negotiation self-efficacy.

Using a method that allows the effects of an individual difference to materialize over time, this study empirically establishes the connection between political skill and negotiation reputation, process and outcomes. The methodological contributions of this study explore the relations between self-rated individual difference variables, peer-rated cooperative behaviors and objective coded negotiation outcomes in evaluating political skill in negotiation.

Against the backdrop of an Indian banking sector that finds itself entangled in the triple deadlock of increasing competition, technological changes and strict regulatory compliance, the study aims to examine the need for reinforcing stringent corporate and risk governance mechanisms as an instrument for improving efficiency and productivity levels.

The authors construct three separate indices, namely, supervisory board index, audit index and risk governance index to measure the governance practices of commercial banks. A slacks-based data envelopment analysis technical efficiency (TE) measure, a variable returns to scale cost efficiency model and Malmquist productivity index are employed to determine TE, cost efficiency and productivity change, respectively. A two-step system-generalized method of moments estimation accounts for the dynamic relationship between governance and efficiency.

The authors show that strict audit and risk governance mechanisms are associated with better efficiency and productivity levels. However, consistent with the free-rider hypothesis, large, independent and diverse boards lead to cost inefficiencies. Strict risk governance structures circumvent the negative effects of high regulatory capital and improve efficiency and total factor productivity. However, friendly boards do not perform efficiently in the presence of regulatory capital, implying that incentives arising from maintaining high levels of equity capital make them more susceptible to risk-taking, and board composition is unable to sidestep this behaviour.

The paper contributes to the literature that explores the linkages between governance, efficiency and productivity. The inferences hold relevance in the post-COVID world, as regulators try to circumvent the additional stress on the banking system by adopting sound corporate and risk governance mechanisms.