A measure for contestedness of a two-person bargaining problem

Claus-Jochen Haake () and Thomas Streck ()
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Claus-Jochen Haake: Paderborn University
Thomas Streck: Paderborn University

No 144, Working Papers Dissertations from Paderborn University, Faculty of Business Administration and Economics

Abstract: Since Nash's (1950) seminal paper on the cooperative bargaining problem, the discipline has concentrated on the design of and solutions for bargaining problems. Nothing was said about how simple or difficult it is to find an agreement. We consider two-person bargaining problems and provide axioms for a mapping that assigns to each bargaining problem a number that quantifies the severeness of the conflict. We term this number the contestedness of a bargaining problem and show that there is one and only one mapping satisfying the axioms. Moreover, the axioms are shown to be logically independent, so that none of them can be dismissed. The contestedness is a normalized version of the standard traveling time introduced by Perles and Maschler (1981) to define a superadditive bargaining solution. Recognizing the payoff set reflects players' preferences our approach can also be utilized to measure similarity of diversity of preferences.

Keywords: Bargaining problem; Contestedness; Perles-Maschler bargaining solution (search for similar items in EconPapers)
JEL-codes: C78 (search for similar items in EconPapers)
Pages: 16
Date: 2025-04
New Economics Papers: this item is included in nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:pdn:dispap:144

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