EconPapers    
Economics at your fingertips  
 

Efficient non-cooperative bargaining despite keeping strategic information private

Elmar Lukas and Andreas Welling

Journal of Corporate Finance, 2017, vol. 42, issue C, 287-294

Abstract: The preferred method for negotiating joint value-added activities, such as e.g. licensing, co-venturing or supply chain expansion, is cooperative bargaining, where agents act rationally and have perfect information, i.e., information sharing occurs. In such settings, however, stronger partner often insist on keeping their valuable information private and thus cooperative bargaining cannot occur due to the lack of information sharing. Though, non-cooperative bargaining is usually assumed to be inefficient. Based on a game-theoretic real options model, we develop a contractual solution that allows the proposer to keep its valuable information private while at the same time motivates the other partner to act in a timely and efficient manner, that is, to be Pareto-efficient.

Keywords: Optimal investment timing; Real options; Game theory; Supply chain; Negotiation (search for similar items in EconPapers)
JEL-codes: G30 D81 L23 C70 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0929119916303571
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:42:y:2017:i:c:p:287-294

Access Statistics for this article

Journal of Corporate Finance is currently edited by A. Poulsen and J. Netter

More articles in Journal of Corporate Finance from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2018-08-04
Handle: RePEc:eee:corfin:v:42:y:2017:i:c:p:287-294