Risk Aversion and the Relationship between Nash's Solution and Subgame Perfect Equilibrium of Sequential Bargaining
AbstractThis article presents some new, intuitive derivations of several results in the bargaining literatrue. These new derivations clarify the relationshps among these results and allow them to be understood in a unified way. These results concern the way in which the risk posture of the bargainers affects the outcome of bargaining as predicted by Nash's (axiomatic) solution of a static bargaining model (Nash, 1950) and by the subgame perfect equilibrium of the infinite horizon sequential bargaining game analyzed by Rubinstein (1982). The analogous, experimentally testable predictions for finite horizon sequential bargaining games are also presented. Copyright 1989 by Kluwer Academic Publishers
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Bibliographic InfoArticle provided by Springer in its journal Journal of Risk and Uncertainty.
Volume (Year): 2 (1989)
Issue (Month): 4 (December)
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