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A one-period memory folk theorem for multilateral bargaining games

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  • Herings, P. Jean-Jacques
  • Meshalkin, Andrey
  • Predtetchinski, Arkadi

Abstract

We study strategies with one-period recall in the context of a general class of multilateral bargaining games. A strategy has one-period recall if actions in a particular period are only conditioned on information in the previous and the current period. We show that if players are sufficiently patient, given any proposal in the space of possible agreements, there exists a subgame perfect equilibrium such that the given proposal is made and unanimously accepted in period zero. As a corollary we derive that also perpetual delay can be sustained as a subgame perfect equilibrium. Our strategies are pure and have one-period recall, and we do not make use of a public randomization device. The players' discount factors are allowed to be heterogeneous. We also construct a finite automata representation of our strategy profile.

Suggested Citation

  • Herings, P. Jean-Jacques & Meshalkin, Andrey & Predtetchinski, Arkadi, 2017. "A one-period memory folk theorem for multilateral bargaining games," Games and Economic Behavior, Elsevier, vol. 103(C), pages 185-198.
    • Handle: RePEc:eee:gamebe:v:103:y:2017:i:c:p:185-198
    DOI: 10.1016/j.geb.2015.11.006
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    Cited by:

    1. Miller, Luis & Montero, Maria & Vanberg, Christoph, 2018. "Legislative bargaining with heterogeneous disagreement values: Theory and experiments," Games and Economic Behavior, Elsevier, vol. 107(C), pages 60-92.
    2. Herings, P. Jean-Jacques & Meshalkin, Andrey & Predtetchinski, Arkadi, 2018. "Subgame perfect equilibria in majoritarian bargaining," Journal of Mathematical Economics, Elsevier, vol. 76(C), pages 101-112.
    3. P. Jean-Jacques Herings & Harold Houba, 2022. "Costless delay in negotiations," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 74(1), pages 69-93, July.
    4. Britz, Volker, 2018. "Rent-seeking and surplus destruction in unanimity bargaining," Games and Economic Behavior, Elsevier, vol. 109(C), pages 1-20.
    5. Thomas, Charles J., 2018. "An alternating-offers model of multilateral negotiations," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 269-293.

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    More about this item

    Keywords

    Dynamic games; Bargaining; Folk theorem; Subgame perfect equilibrium; One-period recall;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory

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