Commitment and Conflict in Bilateral Bargaining

Tore Ellingsen and Topi Miettinen

American Economic Review, 2008, vol. 98, issue 4, 1629-35

Abstract: Building on previous work by Schelling and Crawford, we study a model of bilateral bargaining in which negotiators can make binding commitments at a low positive cost c. Most of our results concern outcomes that survive iterated strict dominance. If commitment attempts never fail, there are three such outcomes. In two of them, all the surplus goes to one player. In the third, there is a high probability of conflict. If commitment attempts succeed with probability q

JEL-codes: C78 D74 (search for similar items in EconPapers)
Date: 2008
Note: DOI: 10.1257/aer.98.4.1629
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Citations: View citations in EconPapers (31)

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