A non cooperative theory of coalitional bargaining

Kalyan Chatierjee, Bhaskar Dutia, Debraj Ray, Kunal Sengupta

    Research output: Chapter in Book/Report/Conference proceedingChapter

    Abstract

    First version received November 1987; final version accepted January 1992 (Eds.) We explore a sequential offers model of n-person coalitional bargaining with transferable utility and with time discounting. Our focus is on the efficiency properties of stationary equilibria of strictly superadditive games, when the discount factor δ is sufficiently large; we do, however, consider examples of other games where subgame perfectness alone is employed. It is shown that delay and the formation of inefficient subcoalitions can occur in equilibrium, the latter for some or all orders of proposer. However, efficient stationary equilibrium payoffs converge to a point in the core, as δ→1. Strict convexity is a sufficient condition for there to exist an efficient stationary equilibrium payoffvector for sufficiently high δ. This vector converges as δ→1 to the egalitarian allocation of Dutta and Ray (1989).

    Original languageEnglish (US)
    Title of host publicationBargaining in the Shadow of the Market
    Subtitle of host publicationSelected Papers on Bilateral and Multilateral Bargaining
    PublisherWorld Scientific Publishing Co.
    Pages97-112
    Number of pages16
    ISBN (Electronic)9789814447577
    ISBN (Print)9814447560, 9789814447560
    DOIs
    StatePublished - Jan 1 2013

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    ASJC Scopus subject areas

    • Business, Management and Accounting(all)
    • Economics, Econometrics and Finance(all)
    • Mathematics(all)

    Cite this

    Chatierjee, K., Dutia, B., Ray, D., & Sengupta, K. (2013). A non cooperative theory of coalitional bargaining. In Bargaining in the Shadow of the Market: Selected Papers on Bilateral and Multilateral Bargaining (pp. 97-112). World Scientific Publishing Co.. https://doi.org/10.1142/9789814447577_0005