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Collusion, Exclusion, and Inclusion in Random-Order Bargaining

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  • Ilya Segal

    (Stanford University)

Abstract

This paper examines three types of contracts in a cooperative game solved by a random-order value (such as Shapley value). An exclusive contract delays the contribution of the excluded player j until the arrival of the excluding player i. It is profitable when j is complementary to other players in the absence of i. An inclusive contract brings the included player j forward to player i's arrival. It is profitable when j is substitutable to other players in the presence of i. Finally, a collusive contract between i and j can be modeled as a proxy agreement under which i always brings j with him. The profit from collusion therefore equals to the sum of profits from exclusion and inclusion. It is positive when i reduces the complementarity between j and the other players.

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  • Ilya Segal, 2000. "Collusion, Exclusion, and Inclusion in Random-Order Bargaining," Econometric Society World Congress 2000 Contributed Papers 0738, Econometric Society.
    • Handle: RePEc:ecm:wc2000:0738
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    Cited by:

    1. Eyal Winter, 2001. "Scapegoats and Optimal Allocation of Responsibility," Discussion Paper Series dp266, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.

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