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Estimating Noncooperative and Cooperative Models of Bargaining: An Empirical Comparison

Author

Listed:
  • Masanori Mitsutsune

    () (Tokyo Metropolitan Government)

  • Takanori Adachi

    () (School of Economics, Nagoya University)

Abstract

This paper examines the issue of model selection in studies of strategic situations. In particular, we compare estimation results from Adachi and Watanabe's (2008) noncooperative formulation of government formulation with those from two alternative cooperative formulations. Although the estimates of the ministerial ranking are similar, statistical testing suggests that Adachi and Watanabe's(2008) noncooperative formulation is best fitted to the observed data among the alternative models. This result implies that modeling the time structure in bargaining situations is crucially important at the risk of possibly misspecifying the details of the game.

Suggested Citation

  • Masanori Mitsutsune & Takanori Adachi, 2011. "Estimating Noncooperative and Cooperative Models of Bargaining: An Empirical Comparison," KIER Working Papers 799, Kyoto University, Institute of Economic Research.
  • Handle: RePEc:kyo:wpaper:799
    as

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    References listed on IDEAS

    as
    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
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    More about this item

    Keywords

    Model selection; Bargaining; Government formation; Structural estimation;

    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • 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
    • H19 - Public Economics - - Structure and Scope of Government - - - Other

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