On the Relevance of Alternatives in Bargaining: Average Alternative Solutions
AbstractWe compare bargaining solutions in terms of the relevance of alternatives. We show that most well-known bargaining solutions do not use all the alternatives, but there are numerous bargaining solutions that do. We introduce a new class of bargaining solutions called ``average alternative solutions'', characterize them, and show that the Nash solution and the Kalai-Smorodinsky solution are limits of average alternative solutions. We also provide alternative characterizations for the Nash solution and the Kalai-Smorodinsky solution.
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Bibliographic InfoPaper provided by National University of Singapore, Department of Economics in its series Departmental Working Papers with number wp0214.
Length: 32 pages
Date of creation: Sep 2002
Date of revision:
bargaining; solutions; axioms; relevance of alternatives; average alternative solutions; monotonic bounds;
Find related papers by JEL classification:
- 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
- D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
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