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Bargaining Unexplained

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  • Dan Usher

    ()
    (Queen's University)

Abstract

We know that people strike bargains and that civilized life could not proceed otherwise. We do not know how bargains are struck. We have no explanation of bargaining, comparable to the general equilibrium in the economy, accounting for essential features of bargaining as we know it with reference to universal self-interested behaviour subject only to economy-wide rules. This claim is supported here in a survey of the principal models of bargaining: as a reflection of a shared sense of fairness, as an imposed sequence of offers, as a source of transaction cost and as a species of conflict. Also discussed is the dual role of bargaining in politics as a necessary complement to voting and as an impediment to the exploitation of minority groups.

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File URL: http://qed.econ.queensu.ca/working_papers/papers/qed_wp_1208.pdf
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Paper provided by Queen's University, Department of Economics in its series Working Papers with number 1208.

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Length: 55 pages
Date of creation: Aug 2009
Date of revision:
Handle: RePEc:qed:wpaper:1208

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Keywords: Bargaining; Comprimise; Fairness; Self-interest; Transaction cost; conflict;

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References

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  1. Muthoo,Abhinay, 1999. "Bargaining Theory with Applications," Cambridge Books, Cambridge University Press, number 9780521576475.
  2. Brams,Steven J. & Taylor,Alan D., 1996. "Fair Division," Cambridge Books, Cambridge University Press, number 9780521556446.
  3. Garfinkel, Michelle R, 1990. "Arming as a Strategic Investment in a Cooperative Equilibrium," American Economic Review, American Economic Association, vol. 80(1), pages 50-68, March.
  4. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
  5. Hirshleifer, Jack, 1991. "The Technology of Conflict as an Economic Activity," American Economic Review, American Economic Association, vol. 81(2), pages 130-34, May.
  6. George L. Priest & Benjamin Klein, 1984. "The Selection of Disputes for Litigation," The Journal of Legal Studies, University of Chicago Press, vol. 13(1), pages 1-56, January.
  7. Hart, Oliver, 1995. "Firms, Contracts, and Financial Structure," OUP Catalogue, Oxford University Press, number 9780198288817, October.
  8. Fearon, James D., 1995. "Rationalist explanations for war," International Organization, Cambridge University Press, vol. 49(03), pages 379-414, June.
  9. Ariel Rubinstein, 2010. "Perfect Equilibrium in a Bargaining Model," Levine's Working Paper Archive 661465000000000387, David K. Levine.
  10. Dan Usher, 2010. "Bargaining and Voting," Working Papers 1245, Queen's University, Department of Economics.
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Cited by:
  1. Dan Usher, 2010. "Three Papers on Bargaining," Working Papers 1239, Queen's University, Department of Economics.
  2. Richard Wagner & Deema Yazigi, 2014. "Form vs. substance in selection through competition: elections, markets, and political economy," Public Choice, Springer, vol. 159(3), pages 503-514, June.
  3. Dan Usher, 2012. "Bargaining and voting," Public Choice, Springer, vol. 151(3), pages 739-755, June.

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