NEGOTIATION ON NATURAL RESOURCES

Joseph Pelzman, Murat Issabayev and Yessengali Oskenbayev ()
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Yessengali Oskenbayev: #x2021;Kazakh-British Technical University, Business School, Almaty, Kazakhstan

Global Economy Journal (GEJ), 2021, vol. 21, issue 01, 1-21

Abstract: The host government (HG) of resource-rich countries (RRC) dealing with multiple International Oil Companies (IOCs) faces a choice between making a simultaneous multilateral offer and a sequential bilateral offer on equity shares from resource value. Provided that the HG treats all its foreign partners in a simultaneous negotiation as a single entity, it is argued that the HG is predicted to gain a higher equity share from a simultaneous multilateral bargaining deal than from a sequential bilateral one with each player. Furthermore, we argue that in case of positive weak externality from a sequential bilateral game, HG would still prefer a simultaneous multilateral game due to superadditivity and efficiency properties of grand coalition.

Keywords: Resource-rich countries; sequential bilateral bargaining; simultaneous multilateral bargaining; coalition; externality (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1142/S2194565921500056

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