Conflict leads to cooperation in demand bargaining

Kareen Rozen ()

Journal of Economic Behavior & Organization, 2013, vol. 87, issue C, 35-42

Abstract: We consider a multilateral Nash demand game in which short-sighted players come to the bargaining table with requests for both coalition partners and the potentially generated resource. We prove that the resulting process converges with probability one to a state in which all players agree on a strictly self-enforcing division of resources (i.e., a strict core allocation). Highlighting group dynamics, we show how the myopic actions of players may lead to the break up of groups in the short run, but can ultimately bring about a situation from which a strictly self-enforcing allocation can be reached.

Keywords: Demand bargaining; Strictly self-enforcing allocations; Strict core; Best response dynamics (search for similar items in EconPapers)
JEL-codes: C7 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:87:y:2013:i:c:p:35-42

DOI: 10.1016/j.jebo.2012.12.005

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