How Communication Links Influence Coalition Bargaining: A Laboratory Investigation

Gary Bolton (), Kalyan Chatterjee () and Kathleen L. McGinn ()
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Kalyan Chatterjee: Department of Economics, Penn State University, University Park, Pennsylvania 16802
Kathleen L. McGinn: Graduate School of Business Administration, Harvard University, Cambridge, Massachusetts 02139

Management Science, 2003, vol. 49, issue 5, 583-598

Abstract: Complexity of communication is one of the important factors that distinguishes multilateral negotiation from its bilateral cousin. We investigate how the communication configuration affects a three-person coalition negotiation. Restricting who can communicate with whom strongly influences outcomes, and not always in ways that current theory anticipates. Competitive frictions, including a tendency to communicate offers privately, appear to shape much of what we observe. Our results suggest that parties with weaker alternatives would benefit from a more constrained structure, especially if they can be the conduit of communication, while those endowed with stronger alternatives would do well to work within a more public communication structure that promotes competitive bidding.

Keywords: Bargaining; Coalition; Communication; Experimental Economics; Game Theory; Negotiation (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (43)

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