An Empirical Analysis of Stubborn Bargaining

Jonas Send and Marco Serena

Working Papers from Max Planck Institute for Tax Law and Public Finance

Abstract: In alternating-offer bargaining, a seller is “stubborn†if she demands the same asking price more than once. We provide empirical evidence on stubbornness and inform the theoretical literature by analyzing millions of eBay bargaining threads taken from Backus et al. (2020). Focusing on the best predictors of first-period stubbornness, we find that stubbornness is sticky, exploitative, and vengeful; a seller who was stubborn in the past is more likely to be stubborn in the future, and a seller is more likely stubborn if the buyer has been particularly lenient or tough in her counteroffer.

JEL-codes: C78 D51 (search for similar items in EconPapers)
Pages: 33
Date: 2021-02
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