A theory of agreements in the shadow of conflict

Joan Esteban () and József Sákovics

Edinburgh School of Economics Discussion Paper Series from Edinburgh School of Economics, University of Edinburgh

Abstract: e present a novel approach to N-person bargaining based on the idea that the agreement reached in a negotiation is determined by how the direct conflict resulting from disagreement would be resolved. Our basic building block is the disagreement function, which maps each set of feasible outcomes into a disagreement point. Adding this function to the description of the bargaining problem, a weak axiom based on individual rationality leads to a unique solution: the agreement in the shadow of conflict, ASC. This agreement must be constructed as a sequence of partial agreements, each of which is reached as a function of the parties' relative power in the disagreement scenario. We also provide non-cooperative implementation.

Keywords: bargaining; conflict; disagreement (search for similar items in EconPapers)
JEL-codes: C78 D74 (search for similar items in EconPapers)
Pages: 32
Date: 2006-02
New Economics Papers: this item is included in nep-gth, nep-mic and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Working Paper: A Theory of Agreements in the Shadow of Conflict (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:edn:esedps:139

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