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Conflict Leads to Cooperation in Nash Bargaining

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  • Kareen Rozen

Abstract

We consider a multilateral Nash demand game where short-sighted players come to the bargaining table with requests for both coalition partners and the potentially generated resource. We prove that group learning leads with probability one to complete cooperation and a strictly self-enforcing allocation (i.e., in the interior of the core). Highlighting group dynamics, we demonstrate that behaviors which appear destructive can themselves lead to beneficial and strictly self-enforcing cooperation.

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Paper provided by David K. Levine in its series Levine's Working Paper Archive with number 122247000000002086.

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Date of creation: 04 Apr 2008
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Handle: RePEc:cla:levarc:122247000000002086

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  1. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, Econometric Society, vol. 18(2), pages 155-162, April.
  2. Hideo Konishi & Debraj Ray, 2000. "Coalition Formation as a Dynamic Process," Boston College Working Papers in Economics, Boston College Department of Economics 478, Boston College Department of Economics, revised 15 Apr 2002.
  3. Chatterjee, Kalyan & Bhaskar Dutta & Debraj Ray & Kunal Sengupta, 1993. "A Noncooperative Theory of Coalitional Bargaining," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 60(2), pages 463-77, April.
  4. Arnold, Tone & Schwalbe, Ulrich, 2002. "Dynamic coalition formation and the core," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 49(3), pages 363-380, November.
  5. M. Kandori & G. Mailath & R. Rob, 1999. "Learning, Mutation and Long Run Equilibria in Games," Levine's Working Paper Archive 500, David K. Levine.
  6. Young H. P., 1993. "An Evolutionary Model of Bargaining," Journal of Economic Theory, Elsevier, Elsevier, vol. 59(1), pages 145-168, February.
  7. Agastya, Murali, 1997. "Adaptive Play in Multiplayer Bargaining Situations," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 64(3), pages 411-26, July.
  8. Perry, M. & Rany, P., 1992. "A Non-Cooperative View of Coalition Formation and the Core," UWO Department of Economics Working Papers, University of Western Ontario, Department of Economics 9203, University of Western Ontario, Department of Economics.
  9. Agastya, Murali, 1999. "Perturbed Adaptive Dynamics in Coalition Form Games," Journal of Economic Theory, Elsevier, Elsevier, vol. 89(2), pages 207-233, December.
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Cited by:
  1. Bary S.R. Pradelski, 2014. "Evolutionary Dynamics and Fast Convergence in the Assignment Game," Economics Series Working Papers 700, University of Oxford, Department of Economics.
  2. H Peyton Young & Heinrich H. Nax & Bary S.R. Pradelski, 2012. "Decentralized dynamics and equitable core selection in assignment games," Economics Series Working Papers 607, University of Oxford, Department of Economics.
  3. Heinrich H. Nax & Bary S. R. Pradelski & H. Peyton Young, 2013. "The Evolution of Core Stability in Decentralized Matching Markets," Working Papers, Fondazione Eni Enrico Mattei 2013.50, Fondazione Eni Enrico Mattei.

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