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Proportional Payoffs in a Model of Two-Stage Bargaining with Reversible Coalitions

Author

Listed:
  • Maria Montero

    (University of Nottingham)

Abstract

This paper studies coalition formation and payoff division in majority games under the following assumptions: first, payoff division can only be agreed upon after the coalition has formed (two-stage bargaining); second, negotiations in the coalition can break down, in which case a new coalition may be formed (reversible coalitions). Under the most natural bargaining protocol, both ex ante and ex post payoff division are proportional to the voting weights. Other bargaining rules may generate counterintuitive comparative statics.

Suggested Citation

  • Maria Montero, 2003. "Proportional Payoffs in a Model of Two-Stage Bargaining with Reversible Coalitions," Game Theory and Information 0308001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpga:0308001
    Note: Type of Document - pdf; pages: 24
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/game/papers/0308/0308001.pdf
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    Cited by:

    1. Stephen Ansolabehere & James M. Snyder & Aaron B. Strauss & Michael M. Ting, 2005. "Voting Weights and Formateur Advantages in the Formation of Coalition Governments," American Journal of Political Science, John Wiley & Sons, vol. 49(3), pages 550-563, July.

    More about this item

    Keywords

    Coalition formation; two-stage bargaining; reversible coalitions; majority games; proportional payoffs;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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