Bargaining with Noisy Communication

V. Denicolo' and Paolo Garella
Authors registered in the RePEc Author Service: Vincenzo Denicolo' ()

Working Papers from Dipartimento Scienze Economiche, Universita' di Bologna

Abstract: In this paper we show that in a bargaining situation the seller may not necessarily want to fully exploit communication possibilities. In the standard two-period bargaining model with one-sided incomplete information, the seller, who owns an indivisible good, makes oers which the buyer can either accept or reject. We ask whether the seller can prot from manipulating the communication mechanism by sending offers that reach the buyer with probability less than one (noisy communication). Noisy communication is a way to improve the seller's second period beliefs about the buyer's willingness to pay for the good and is therefore a way to "buy" commitment. We study the case of a discrete distribution of buyer's types and show that there exist equilibria with noisy communication when there are at least three different types of buyers.

Date: 1996-12
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://amsacta.unibo.it/5039/1/271.pdf (application/pdf)

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:bol:bodewp:271

Access Statistics for this paper

More papers in Working Papers from Dipartimento Scienze Economiche, Universita' di Bologna Contact information at EDIRC.
Bibliographic data for series maintained by Dipartimento Scienze Economiche, Universita' di Bologna ().