Delegated bargaining in a competitive agent market: an experimental study
Abstract We examine a variant of ultimatum bargaining in which principals may delegate their proposal decision to agents hired from a competitive market. Contrary to several prior studies, we find that when principals must use agents, the resulting proposals are significantly higher than when principals make proposals themselves. In reconciling our results with prior findings, we conclude that both the rejection power afforded to responders and the structure of principal-agent contracts can play significant roles in the nature of outcomes under delegated bargaining.
Volume (Year): 2 (2016)
Issue (Month): 1 (May)
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