Do Buyer-Size Discounts Depend on the Curvature of the Surplus Function? Experimental Tests of Bargaining Models
Hans-Theo Normann,
Bradley Ruffle and
Christopher M. Sndyer
Additional contact information
Christopher M. Sndyer: George Washington University
Experimental from University Library of Munich, Germany
Abstract:
A number of recent theoretical papers have shown that for buyer-size discounts to emerge in a bargaining model, the total surplus function over which parties bargain must have certain nonlinearities. We test the theory in an experimental setting in which a seller bargains with a number of buyers of different sizes. We generate nonlinearities in the surplus function by varying the shape of the seller's cost function. Our results strongly support the theory. As predicted, large-buyer discounts emerge only in the case of increasing marginal cost, corresponding to a concave surplus function.
Keywords: buyer-size discounts; large buyer; experimental economics. (search for similar items in EconPapers)
JEL-codes: C78 C90 (search for similar items in EconPapers)
Date: 2003-08-03
New Economics Papers: this item is included in nep-exp
Note: Type of Document - LaTex; prepared on UNIX; to print on HP;
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)
Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/exp/papers/0308/0308001.pdf (application/pdf)
Related works:
Journal Article: Do buyer-size discounts depend on the curvature of the surplus function? Experimental tests of bargaining models (2007) 
Working Paper: Do Buyer-Size Discounts Depend on the Curvature of the Surplus Function? Experimental Tests of Bargaining Models (2004) 
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:wpa:wuwpex:0308001
Access Statistics for this paper
More papers in Experimental from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).