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Sequential Negotiations: Substitutes versus Complements

Author

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  • Bjørn-Atle Reme
  • Lars Sørgard

Abstract

This paper analyzes a sequential negotiation game where a retailer and its two suppliers negotiate over the sharing of their jointly created surplus. We show that the suppliers each prefer to negotiate first (second) if the suppliers are substitutes (complements) in producing joint surplus, while the retailer is indifferent to the order of negotiations.

Suggested Citation

  • Bjørn-Atle Reme & Lars Sørgard, 2016. "Sequential Negotiations: Substitutes versus Complements," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 172(4), pages 639-644, December.
    • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(201612)172:4_639:snsvc_2.0.tx_2-2
    DOI: 10.1628/093245616X14605537965102
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    More about this item

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts

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