A Note on Simple Strategic Bargaining for Models of Money or Credit

Yu Zhu

Journal of Money, Credit and Banking, 2019, vol. 51, issue 2-3, 739-754

Abstract: Many papers on liquidity have bilateral trade with buyers constrained by their money holdings or debt limits. Axiomatic bargaining, typically Nash, determines the terms of trade. However, there are reasons to prefer strategic bargaining. I analyze a bargaining game that is useful in models of liquidity. Advantages include (i) it has simple microfoundations, both in and out of steady state; (ii) it is more tractable than Nash, but the outcomes share interesting features; (iii) the benchmark version is consistent with axiomatic approaches in the literature, while another version is not, but can still be used; and (iv) it is arguably realistic.

Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://doi.org/10.1111/jmcb.12508

Related works:
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:wly:jmoncb:v:51:y:2019:i:2-3:p:739-754

Access Statistics for this article

Journal of Money, Credit and Banking is currently edited by Robert deYoung, Paul Evans, Pok-Sang Lam and Kenneth D. West

More articles in Journal of Money, Credit and Banking from Blackwell Publishing
Bibliographic data for series maintained by Wiley Content Delivery ().