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Concession Bargaining - An Experimental Comparison of Protocols and Time Horizons

Author

Listed:
  • Federica Alberti

    () (Max Planck Institute of Economics, Strategic Interaction Group, Jena)

  • Sven Fischer

    (Max Planck Institute of Economics, Strategic Interaction Group, Jena)

  • Werner Güth

    () (Max Planck Institute of Economics, Strategic Interaction Group, Jena)

  • Kei Tsutsui

    (Frankfurt School of Finance & Management, Frankfurt am Main)

Abstract

Concessions try to avoid conflict in bargaining and can finally lead to an agreement. Although they usually are seen as unfolding in time, concessions can also be studied in normal form or by conditioning only on failure of earlier agreement attempts. We experimentally compare three protocols of concession bargaining, the normal form or static one, the one where concessions only condition on earlier failures and the truly dynamic one. In spite of their considerable differences in conditioning, the three protocols do not differ in agreement ratio, efficiency and inequality of agreements. There are, however, effects of the maximal number of trials to reach an agreement by concession making and of protocol on when to abstain from conceding.

Suggested Citation

  • Federica Alberti & Sven Fischer & Werner Güth & Kei Tsutsui, 2013. "Concession Bargaining - An Experimental Comparison of Protocols and Time Horizons," Jena Economic Research Papers 2013-052, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2013-052
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    File URL: http://pubdb.wiwi.uni-jena.de/pdf/wp_2013_052.pdf
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    References listed on IDEAS

    as
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    4. Nash, John, 1953. "Two-Person Cooperative Games," Econometrica, Econometric Society, vol. 21(1), pages 128-140, April.
    5. Grimm, Veronika & Mengel, Friederike, 2011. "Let me sleep on it: Delay reduces rejection rates in ultimatum games," Economics Letters, Elsevier, vol. 111(2), pages 113-115, May.
    6. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
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    More about this item

    Keywords

    concession bargaining; dynamic interaction; emotions; deadline; conflict; experiment;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory

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