Mediation in Reputational Bargaining

Jack Fanning

American Economic Review, 2021, vol. 111, issue 8, 2444-72

Abstract: Can an uninformed mediator improve outcomes in a dynamic reputational bargaining model? I show that a simple communication protocol used by professional mediators, of announcing an agreement only if both parties privately accept its terms, can increase the payoffs of rational bargainers, but only if communication is noisy: the mediator must sometimes fail to suggest a deal even when both bargainers accept it.

JEL-codes: C78 D74 D83 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (4)

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DOI: 10.1257/aer.20191321

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