This short paper demonstrates that the equilibrium payoffs of an alternating-offers bargaining game over a unit of surplus converge to equal division provided that the parties are allowed to bargain over all the surpluses generated by the "right" to be the first to make offers. The result obtained in the present paper may provide some "justification" for other division procedures such as the divide-and-choose or the moving-knife mechanisms.
Volume (Year): 30 (2010)
Issue (Month): 2 ()
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- Ariel Rubinstein, 2010.
"Perfect Equilibrium in a Bargaining Model,"
Levine's Working Paper Archive
661465000000000387, David K. Levine.
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- Nash, John, 1953. "Two-Person Cooperative Games," Econometrica, Econometric Society, vol. 21(1), pages 128-140, April.
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