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Bargaining behavior and the tragedy of the anticommons

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  • Parente, Michael D.
  • Winn, Abel M.

Abstract

To date, most experimental studies of the tragedy of the anticommons treat individuals’ preferences as common knowledge. Here, we conduct experiments in which values are private information. We vary the bargaining institution, the buyer's signaled willingness to pay, and the fraction of sellers whose inputs must be assembled. In our experiments simultaneous bargaining gives the buyer a better tradeoff between the total price paid and the risk of failure than sequential bargaining when all sellers’ inputs are necessary. When two thirds are necessary assembly failure virtually disappears, but simultaneous bargaining still generates lower prices for the buyer.

Suggested Citation

  • Parente, Michael D. & Winn, Abel M., 2012. "Bargaining behavior and the tragedy of the anticommons," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 475-490.
  • Handle: RePEc:eee:jeborg:v:84:y:2012:i:2:p:475-490
    DOI: 10.1016/j.jebo.2012.08.002
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Isaac, R. Mark & Kitchens, Carl & Portillo, Javier E., 2016. "Can buyer “mobility” reduce aggregation failures in land-assembly?," Journal of Urban Economics, Elsevier, vol. 95(C), pages 16-30.
    2. Shupp Robert & Cadigan John & Schmitt Pamela M. & Swope Kurtis J., 2013. "Institutions and information in multilateral bargaining experiments," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 13(1), pages 485-524, June.
    3. Abel M. Winn & Matthew W. McCarter, 2016. "Who’s Holding Out? An Experimental Study of the Benefits and Burdens of Eminent Domain," Working Papers 0154mkt, College of Business, University of Texas at San Antonio.
    4. Swope, Kurtis J. & Cadigan, John & Schmitt, Pamela, 2014. "That's my final offer! Bargaining behavior with costly delay and credible commitment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 49(C), pages 44-53.

    More about this item

    Keywords

    Land assembly problem; Tragedy of the anticommons; Experimental economics;

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • D79 - Microeconomics - - Analysis of Collective Decision-Making - - - Other

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