Too good to be true: Suspicion-based rejections of high offers

It is a common belief that high offers are more readily accepted than low offers. In contrast to this general notion, the current set of studies shows that there is a limit to the beneficial effects of making high offers and that becoming too generous may backfire. This paradoxical finding is observed when offers are made in an ambiguous situation of asymmetric information. In three studies, we found that when bargaining opponents had private information over the total amount that was to be distributed, participants became suspicious about high offers (i.e., offers that were beneficial to themselves), but not about low or equal offers. Due to suspicion, participants rejected high offers more often than equal offers.