Sequential bargaining in a market with one seller and two different buyers
AbstractA matching and bargaining model in a market with one seller and two buyers, differing only in their reservation price, is analyzed. No subgame perfect equilibrium exists for stationary strategies. The authors demonstrate the existence of inefficient equilibria in which the low buyer receives the good with large probability, even as friction becomes negligible. They investigate the relationship between the use of Nash and sequential bargaining. Nash bargaining seems applicable only when the sequential approach yields a unique stationary strategy subgame perfect equilibrium.
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Bibliographic InfoArticle provided by Elsevier in its journal Games and Economic Behavior.
Volume (Year): 3 (1991)
Issue (Month): 4 (November)
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Web page: http://www.elsevier.com/locate/inca/622836
Other versions of this item:
- Ebbe Groes & Torben Tranæs, 1989. "Sequential Bargaining in a Market with One Seller and Two Different Buyers," Discussion Papers 89-22, University of Copenhagen. Department of Economics.
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
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- Bård Harstad, 2011.
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- Chatterjee, Kalyan & Dutta, Bhaskar, 1998.
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- Sempere-Monerris, José J. & Vannetelbosch, Vincent J., 1997. "Bargaining with Externalities: Licensing of an Innovation," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 1997007, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
- Chatterjee, Kalyan & Dutta, Bhaskar, 2006. "Markets with Bilateral Bargaining and Incomplete Information," The Warwick Economics Research Paper Series (TWERPS) 762, University of Warwick, Department of Economics.
- Mitsutoshi M. Adachi, 1998. "A note on frictions in the Bazaar type bargaining game," Investigaciones Economicas, Fundación SEPI, vol. 22(2), pages 293-304, May.
- Kalyan Chatterjee & Kaustav Das, 2013. "Decentralised Bilateral Trading in a Market with Incomplete Information," Discussion Papers 1313, Exeter University, Department of Economics.
- Charles J. Thomas, 2012. "An Alternating-Offers Model of Multilateral Negotiations," Working Papers 12-31, Chapman University, Economic Science Institute.
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