Proportional Payoffs in a Model of Two-Stage Bargaining with Reversible Coalitions
AbstractThis 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.
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Bibliographic InfoPaper provided by EconWPA in its series Game Theory and Information with number 0308001.
Length: 24 pages
Date of creation: 13 Aug 2003
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Note: Type of Document - pdf; pages: 24
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Coalition formation; two-stage bargaining; reversible coalitions; majority games; proportional payoffs;
Find related papers by JEL classification:
- C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
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