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Rationality and solutions to nonconvex bargaining problems: Rationalizability and Nash solutions

  • Xu, Yongsheng
  • Yoshihara, Naoki

Conditions α and β are two well-known rationality conditions in the theory of rational choice. This paper examines the implications of weaker versions of these two rationality conditions in the context of solutions to nonconvex bargaining problems. It is shown that, together with the standard axioms of efficiency and strict individual rationality, they imply rationalizability of solutions to nonconvex bargaining problems. We then characterize asymmetric Nash solutions by imposing a continuity and the scale invariance requirements. These results make a further connection between solutions to nonconvex bargaining problems and rationalizability of choice function in the theory of rational choice.

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Article provided by Elsevier in its journal Mathematical Social Sciences.

Volume (Year): 66 (2013)
Issue (Month): 1 ()
Pages: 66-70

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Handle: RePEc:eee:matsoc:v:66:y:2013:i:1:p:66-70
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505565

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  9. Marco Mariotti, 1998. "Fair Bargains: Distributive Justice and Nash Bargaining Theory," Royal Holloway, University of London: Discussion Papers in Economics 98/16, Department of Economics, Royal Holloway University of London, revised Feb 1998.
  10. Peters Hans & Vermeulen Dries, 2006. "WPO, COV and IIA bargaining solutions," Research Memorandum 021, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
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  12. Sen, Amartya K, 1977. "Social Choice Theory: A Re-examination," Econometrica, Econometric Society, vol. 45(1), pages 53-89, January.
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