Chinese commercial negotiating style

by Lucian Pye

This study analyzes Chinese commercial negotiating practices for two reasons. The first is to minimize future misunderstandings in such activities, and the second is to provide guidance for government-to-government negotiations. The research procedure used involved interviews with U.S. businessmen and bankers with extensive experience in the China trade, and--in order to control for U.S. cultural factors--interviews with comparable Japanese bankers and businessmen. What was learned from the experiences of businessmen is of value in government-to-government negotiations, even though there are substantial differences between commercial and diplomatic relationships. At present, both Beijing and Washington seek a more cooperative and complementary relationship. By better understanding the Chinese style of negotiating in the commercial realm, we should be able to avoid misunderstandings and achieve desired goals in the political realm.

Originally published in: a book with the same title, Cambridge, Mass., Oelgeschlager, Gunn & Haine Publishers, Inc., 1982.

This report is part of the RAND Corporation Reprint series. The Reprint was a product of the RAND Corporation from 1992 to 2011 that represented previously published journal articles, book chapters, and reports with the permission of the publisher. RAND reprints were formally reviewed in accordance with the publisher's editorial policy and compliant with RAND's rigorous quality assurance standards for quality and objectivity. For select current RAND journal articles, see External Publications.

Our mission to help improve policy and decisionmaking through research and analysis is enabled through our core values of quality and objectivity and our unwavering commitment to the highest level of integrity and ethical behavior. To help ensure our research and analysis are rigorous, objective, and nonpartisan, we subject our research publications to a robust and exacting quality-assurance process; avoid both the appearance and reality of financial and other conflicts of interest through staff training, project screening, and a policy of mandatory disclosure; and pursue transparency in our research engagements through our commitment to the open publication of our research findings and recommendations, disclosure of the source of funding of published research, and policies to ensure intellectual independence. For more information, visit

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.