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Bargaining over a jointly produced pie: The effect of the production function on bargaining outcomes

Ai Takeuchi, Róbert Veszteg, Yoshio Kamijo and Yukihiko Funaki

Games and Economic Behavior, 2022, vol. 134, issue C, 169-198

Abstract: Using experimental data, we show that the characteristics of the joint production process have a notable impact on the distribution of bargaining agreements. The setting in which the jointly produced surplus is expressed to be proportional to individual inputs leads to significantly more proportional bargaining agreements. This is in contrast to the setting in which the surplus is expressed as an additive constant, where bargaining agreements are more in line with the Nash bargaining solution.

Keywords: Unstructured bargaining; Earned wealth; Production function; Proportional solution; Nash bargaining solution; Laboratory experiment (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1016/j.geb.2022.03.016

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