From ultimatum to Nash bargaining: Theory and experimental evidence
AbstractWe consider a sequential two-party bargaining game with uncertain information transmission. When the first mover states her demand she does only know the probability with which the second mover will be informed about it. The informed second mover can either accept or reject the offer and payoffs are determined as in the ultimatum game. Otherwise the uninformed second mover states his own demand and payoffs are determined as in the Nash demand game. In the experiment we vary the commonly known probability of information transmission. Our main finding is that first moversâ€™ and uninformed second moversâ€™ demands adjust to this probability as qualitatively predicted, that is, first moversâ€™ (uninformed second moversâ€™) demands are lower (higher) the lower the probability of information transmission. Copyright Springer Science + Business Media, LLC 2006
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Springer in its journal Experimental Economics.
Volume (Year): 9 (2006)
Issue (Month): 1 (April)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=102888
Commitment; Imperfect observability; Ultimatum bargaining; Nash bargaining; Experiments;
Other versions of this item:
- Fischer, S. & Güth, W. & Müller, W. & Stiehler, A., 2006. "From ultimatum to Nash bargaining: Theory and experimental evidence," Open Access publications from Tilburg University urn:nbn:nl:ui:12-193644, Tilburg University.
- Fischer, S. & Güth, W. & Stiehler, A. & Müller, W., 2003. "From Ultimatum to Nash Bargaining: Theory and Experimental Evidence," Discussion Paper 2003-41, Tilburg University, Center for Economic Research.
- Sven Fischer & Werner Güth & Wieland Müller, . "From Ultimatum to Nash Bargaining: Theory and Experimental Evidence," Papers on Strategic Interaction 2003-07, Max Planck Institute of Economics, Strategic Interaction Group.
- 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
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Harsanyi, John C., 1995.
"A new theory of equilibrium selection for games with complete information,"
Games and Economic Behavior,
Elsevier, vol. 8(1), pages 91-122.
- Harsanyi John C., 1995. "A New Theory of Equilibrium Selection for Games with Incomplete Information," Games and Economic Behavior, Elsevier, vol. 10(2), pages 318-332, August.
- Van Huyck, John B & Battalio, Raymond C & Beil, Richard O, 1990.
"Tacit Coordination Games, Strategic Uncertainty, and Coordination Failure,"
American Economic Review,
American Economic Association, vol. 80(1), pages 234-48, March.
- J. B. Van Huyck & R. C. Battalio & R. O. Beil, 2010. "Tacit coordination games, strategic uncertainty, and coordination failure," Levine's Working Paper Archive 661465000000000393, David K. Levine.
- John B Van Huyck & Raymond C Battalio & Richard O Beil, 1997. "Tacit coordination games, strategic uncertainty, and coordination failure," Levine's Working Paper Archive 1225, David K. Levine.
- Amnon Rapoport, 1997. "Order of Play in Strategically Equivalent Games in Extensive Form," International Journal of Game Theory, Springer, vol. 26(1), pages 113-136.
- Rubinstein, Ariel, 1989. "The Electronic Mail Game: Strategic Behavior under "Almost Common Knowledge."," American Economic Review, American Economic Association, vol. 79(3), pages 385-91, June.
- Fershtman, Chaim & Judd, Kenneth L & Kalai, Ehud, 1991.
"Observable Contracts: Strategic Delegation and Cooperation,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 32(3), pages 551-59, August.
- Chaim Fershtman & Kenneth L. Judd & Ehud Kalai, 1990. "Observable Contracts: Strategic Delegation and Cooperation," Discussion Papers 879, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Guth, Werner, 1995. "On ultimatum bargaining experiments -- A personal review," Journal of Economic Behavior & Organization, Elsevier, vol. 27(3), pages 329-344, August.
- Bagwell, Kyle, 1995.
"Commitment and observability in games,"
Games and Economic Behavior,
Elsevier, vol. 8(2), pages 271-280.
- Damme, E.E.C. van & Hurkens, J.P.M., 1997.
"Games with imperfectly observable commitment,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-74216, Tilburg University.
- Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
- Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
- Van Huyck, John B & Battalio, Raymond C & Beil, Richard O, 1991. "Strategic Uncertainty, Equilibrium Selection, and Coordination Failure in Average Opinion Games," The Quarterly Journal of Economics, MIT Press, vol. 106(3), pages 885-910, August.
- Steffen Huck & Wieland Mueller, 1998.
"Perfect versus imperfect observability---An experimental test of Bagwell's result,"
- Huck, Steffen & Muller, Wieland, 2000. "Perfect versus Imperfect Observability--An Experimental Test of Bagwell's Result," Games and Economic Behavior, Elsevier, vol. 31(2), pages 174-190, May.
- Antonio Cabrales & Walter Garcia Fontes & Massimo Motta, 1997.
"Risk dominance selects the leader. An experimental analysis,"
Economics Working Papers
222, Department of Economics and Business, Universitat Pompeu Fabra.
- Cabrales, Antonio & Garcia-Fontes, Walter & Motta, Massimo, 2000. "Risk dominance selects the leader: An experimental analysis," International Journal of Industrial Organization, Elsevier, vol. 18(1), pages 137-162, January.
- John C. Harsanyi & Reinhard Selten, 1988. "A General Theory of Equilibrium Selection in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582384, December.
- Straub, Paul G., 1995. "Risk dominance and coordination failures in static games," The Quarterly Review of Economics and Finance, Elsevier, vol. 35(4), pages 339-363.
- Anders Poulsen & Jonathan Tan, 2007. "Information acquisition in the ultimatum game: An experimental study," Experimental Economics, Springer, vol. 10(4), pages 391-409, December.
- Werner Güth & Martin G. Kocher, 2013.
"More than Thirty Years of Ultimatum Bargaining Experiments: Motives, Variations, and a Survey of the Recent Literature,"
CESifo Working Paper Series
4380, CESifo Group Munich.
- Werner Güth & Martin G. Kocher, 2013. "More than thirty years of ultimatum bargaining experiments: Motives, variations, and a survey of the recent literature," Jena Economic Research Papers 2013-035, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
- Judith Avrahami & Werner Güth & Ralph Hertwig & Yaakov Kareev & Hironori Otsubo, 2010.
"Learning (Not) To Yield: An Experimental Study of Evolving Ultimatum Game Behavior,"
Jena Economic Research Papers
2010-092, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
- Avrahami, Judith & Güth, Werner & Hertwig, Ralph & Kareev, Yaakov & Otsubo, Hironori, 2013. "Learning (not) to yield: An experimental study of evolving ultimatum game behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 47(C), pages 47-54.
- Feltovich, Nick & Swierzbinski, Joe, 2011. "The role of strategic uncertainty in games: An experimental study of cheap talk and contracts in the Nash demand game," European Economic Review, Elsevier, vol. 55(4), pages 554-574, May.
- Poulsen, Anders, 2007. "Learning to Make Strategic Moves: Experimental Evidence," MPRA Paper 10927, University Library of Munich, Germany.
- Anders Poulsen & Michael Roos, 2010.
"Do people make strategic commitments? Experimental evidence on strategic information avoidance,"
Springer, vol. 13(2), pages 206-225, June.
- Anders Poulsen & Michael Roos, 2010. "Do People Make Strategic Commitments? Experimental Evidence on Strategic Information Avoidance," University of East Anglia Applied and Financial Economics Working Paper Series 007, School of Economics, University of East Anglia, Norwich, UK..
- Anders U. Poulsen & Michael W. M. Roos, 2009. "Do people make strategic commitments? Experimental evidence on strategic information avoidance," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 09-01, School of Economics, University of East Anglia, Norwich, UK..
- Güth, W. & Müller, W. & Spiegel, Y., 2006.
"Noisy leadership: An experimental approach,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-193643, Tilburg University.
- Anders U. Poulsen & Michael V. M. Roos, 2009. "Do People Make Strategic Moves? Experimental Evidence on Strategic Information Avoidance," Discussion Papers 09-06, University of Copenhagen. Department of Economics.
- Poulsen, Anders U. & Tan, Jonathan H.W., 2004. "Can Information Backfire? - Experimental Evidence from the Ultimatum Game," Working Papers 04-16, University of Aarhus, Aarhus School of Business, Department of Economics.
- Tanja Hörtnagl & Rudolf Kerschbamer, 2014. "How the Value of Information Shapes the Value of Commitment Or: Why the Value of Commitment Does Not Vanish," Working Papers 2014-03, Faculty of Economics and Statistics, University of Innsbruck.
- Uschi Backes-Gellner & Donata Bessey & Kerstin Pull & Simone Tuor, 2008. "What Behavioural Economics Teaches Personnel Economics," Working Papers 0077, University of Zurich, Institute for Strategy and Business Economics (ISU).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.