Bargaining behavior and the tragedy of the anticommons

Michael D. Parente and Abel Winn

Journal of Economic Behavior & Organization, 2012, vol. 84, issue 2, 475-490

Abstract: To date, most experimental studies of the tragedy of the anticommons treat individuals’ preferences as common knowledge. Here, we conduct experiments in which values are private information. We vary the bargaining institution, the buyer's signaled willingness to pay, and the fraction of sellers whose inputs must be assembled. In our experiments simultaneous bargaining gives the buyer a better tradeoff between the total price paid and the risk of failure than sequential bargaining when all sellers’ inputs are necessary. When two thirds are necessary assembly failure virtually disappears, but simultaneous bargaining still generates lower prices for the buyer.

Keywords: Land assembly problem; Tragedy of the anticommons; Experimental economics (search for similar items in EconPapers)
JEL-codes: C7 C9 D79 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:84:y:2012:i:2:p:475-490

DOI: 10.1016/j.jebo.2012.08.002

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