In this note we provide a characterization of a subclass of bargaining problems for which the Nash solution has the property of disagreement point monotonicity. While the original d-monotonicity axiom and its stronger notion, strong d-monotonicity, were introduced and discussed by Thomson [15], this paper introduces local strong d-monotonicity and derives a necessary and sufficient condition for the Nash solution to be locally strong d-monotonic. This characterization is given by using the sensitivity matrix of the Nash bargaining solution w.r.t. the disagreement point d. Moverover, we present a sufficient condition for the Nash solution to be strong d-monotonic.
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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number
107.
Find related papers by JEL classification: C61 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Optimization Techniques; Programming Models; Dynamic Analysis C62 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Existence and Stability Conditions of Equilibrium C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
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