Resolving the Complexity-Flexibility Dilemma in Multi-Issue Negotiations: Nested Bracketing as a Strategy to Enhance Negotiation Outcomes

Multi-issue negotiations present a complexity–flexibility dilemma: While multiple issues provide structural flexibility—offering opportunities for win–win agreements through variable-sum agreement options—they also entail structural complexity, requiring negotiators to process numerous trade-offs, concession patterns, and agreement alternatives. This research examines how negotiators navigate this dilemma by focusing on issue bracketing strategies—cognitive approaches for managing complexity by mentally grouping issues into subsets. Across six experiments (N = 1,602), we investigate how different bracketing strategies influence joint outcomes. We first examine subset bracketing, a widely used cognitive strategy that improves outcomes when it aligns with task flexibility—namely, when integrative trade-off opportunities are concentrated within subsets—but hinders outcomes when it misaligns, with such opportunities scattered across subsets. To address this limitation, we propose nested bracketing—a hierarchical information-processing strategy in which issues are organized into subordinate subsets to manage complexity and then integrated into a superordinate structure to preserve flexibility. Across studies, nested bracketing enables negotiators to recognize dispersed integrative trade-off opportunities by fostering insight into counterparts’ priorities, thereby improving joint negotiation outcomes. This work clarifies when subset bracketing helps or hurts in multi-issue negotiations and introduces nested bracketing as an effective approach for managing complexity without sacrificing flexibility.