Costless Delay in Negotiations

P. Jean-Jacques Herings and Harold Houba

No 15-010/II, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: We study strategic negotiation models featuring costless delay, general recognition procedures, endogenous voting orders, and finite sets of alternatives. Two examples show: 1. non-existence of stationary subgame-perfect equilibrium (SSPE). 2. the recursive equations and optimality conditions are necessary for SSPE but insufficient because these equations can be singular. Strategy profiles excluding perpetual disagreement guarantee non-singularity. The necessary and sufficient conditions for existence of stationary best responses additionally require either an equalizing condition or a minimality condition. Quasi SSPE only satisfy the recursive equations and optimality conditions. These always exist and are SSPE if either all equalizing conditions or all minimality conditions hold.

Keywords: Bargaining; existence; one-stage-deviation principle; dynamic programming; recursive equations; Markov Decision Theory (search for similar items in EconPapers)
JEL-codes: C72 C73 C78 (search for similar items in EconPapers)
Date: 2015-01-22
New Economics Papers: this item is included in nep-gth and nep-mic
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Related works:
Journal Article: Costless delay in negotiations (2022)
Working Paper: Costless delay in negotiations (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20150010

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