Risk aversion in the Nash bargaining problem with uncertainty
Sanxi Li (lisanxi@gmail.com),
Hailin Sun (hailinsun@gmail.com),
Jianye Yan (yanjianye@gmail.com) and
Xundong Yin (yinxundong@gmail.com)
Journal of Economics, 2015, vol. 115, issue 3, 257-274
Abstract:
In this study, we apply the aggregation property of Identical Shape Harmonic Absolute Risk Aversion utility functions to analyze the comparative statics properties of a bargaining model with uncertainty. We identify sufficient and necessary conditions under which an increase in one’s degree of risk aversion benefits/hurts one’s opponent. We apply our model to analyze the problems of bargaining over both insurance and incentive contracts. Copyright Springer-Verlag Wien 2015
Keywords: Bargaining; The Nash solution; ISHARA preference; Risk aversion; C70; C78 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:kap:jeczfn:v:115:y:2015:i:3:p:257-274
DOI: 10.1007/s00712-014-0413-5
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