Optimally stubborn: how long to hold and who will fold?

Anna M. Sanktjohanser ()
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Anna M. Sanktjohanser: Toulouse School of Economics

Theoretical Economics, Forthcoming

Abstract: I consider a model of reputational bargaining in which the stubborn type can choose their initial demand. There are two types of players: rational and stubborn. The game has two stages: a demand stage and a concession stage. Types can pool or separate in equilibrium for any fixed probability of facing a stubborn type. When the probability of facing a stubborn type is small, any feasible payoff can be achieved in equilibrium for either type. When the probability is large, there is either immediate agreement or long delays.

Keywords: Reputational bargaining; war of attrition (search for similar items in EconPapers)
JEL-codes: C73 C78 (search for similar items in EconPapers)
Date: 2026-01-14
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