Bargaining and inequity aversion: On the efficiency of the double auction

Alexander Rasch, Achim Wambach and Kristina Wiener

Economics Letters, 2012, vol. 114, issue 2, 178-181

Abstract: In a bargaining setting with asymmetrically informed, inequity-averse parties, a fully efficient mechanism (i.e., the double auction) exists if and only if compassion is strong. Less compassionate parties do not trade in the double auction in the limit of strong envy.

Keywords: Bargaining; Double auction; Inequity aversion; Mechanism design; Two-sided asymmetric information (search for similar items in EconPapers)
JEL-codes: C78 D44 D82 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:114:y:2012:i:2:p:178-181

DOI: 10.1016/j.econlet.2011.09.027

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