EconPapers    
Economics at your fingertips  
 

Bargaining with Incomplete Information: An Infinite-Horizon Model with Two-Sided Uncertainty

Peter Cramton ()

Review of Economic Studies, 1984, vol. 51, issue 4, 579-593

Abstract: The resolution of any bargaining conflict depends crucially on the relative urgency of the agents to reach agreement and the information each agent has about the others' preferences. This paper explores, within the context of an infinite-horizon bargaining model with two-sided uncertainty, how timing and information affect the rational behaviour of agents when commitment is not possible. Since the bargainers are uncertain about whether trade is desirable, they must communicate some of their private information before an agreement can be reached. This need for learning, due to incomplete information about preferences, results in bargaining inefficiencies: trade often occurs after costly delay. Thus, the model provides an explanation for the inefficient bargaining behaviour that appears to occur often in practice.

Date: 1984
References: Add references at CitEc
Citations: View citations in EconPapers (28) Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.2307/2297780 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Bargaining with Incomplete Information: An Infinite-Horizon Model with Two-Sided Uncertainty (1998) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:restud:v:51:y:1984:i:4:p:579-593.

Access Statistics for this article

Review of Economic Studies is currently edited by Andrea PratEditor-Name: Bruno BiaisEditor-Name: Kjetil StoreslettenEditor-Name: Enrique Sentana

More articles in Review of Economic Studies from Oxford University Press
Bibliographic data for series maintained by Oxford University Press ().

 
Page updated 2019-12-08
Handle: RePEc:oup:restud:v:51:y:1984:i:4:p:579-593.