The Coalitional Nash Bargaining Solution

Olivier Compte () and Philippe Jehiel ()

Econometrica, 2010, vol. 78, issue 5, 1593-1623

Abstract: The coalitional Nash bargaining solution is defined to be the core allocation for which the product of players' payoffs is maximal. We consider a non-cooperative model with discounting in which one team may form and every player is randomly selected to make a proposal in every period. The grand team, consisting of all players, generates the largest surplus. But a smaller team may form. We show that as players get more patient if an efficient and stationary equilibrium exists, it must deliver payoffs that correspond to the coalitional Nash bargaining solution. We also characterize when an efficient and stationary equilibrium exists, which requires conditions that go beyond the nonemptiness of the core. Copyright 2010 The Econometric Society.

Date: 2010
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Working Paper: The Coalitional Nash Bargaining Solution (2010)
Working Paper: The Coalitional Nash Bargaining Solution (2010)
Working Paper: The Coalitional Nash Bargaining Solution (2008)
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