Voting Rules in Bargaining with Costly Persistent Recognition
In this paper, we consider a model of multilateral bargaining where homogeneous agents may exert e¤ort before negotiations in order to inuence their chances to become the proposer. E¤ort levels have a permanent effect on the recognition process (persistent recognition). We prove two main results. First, all voting rules are equivalent (that is, they yield the same social cost) when recognition becomes persistent. Secondly, an equilibrium may fail to exist, because players may have more incentives to reduce their e¤ort level (in order to be included in winning coalitions) than to increase it (in order to increase their proposal power). Both results di¤er greatly from the case where recognition is transitory: Yildirim (2007) shows that una- nimity is the unique strictly optimal rule, and that an equilibrium always exists (under mild assumptions) in such a setting. Moreover, our second conclusion is quite di¤erent from the one obtained in most of the existing literature on bargaining (which assumes an exogenous recognition process), where it is generally considered that it is always in an agents best interest to have a proposal power as high as possible.
|Date of creation:||Jan 2011|
|Date of revision:||Jun 2012|
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- Nicolas Quérou & Raphael Soubeyran, 2010. "On the (In-)Efficiency of Unanimity in Multilateral Bargaining with Endogenous Recognition," Working Papers 10-14, LAMETA, Universtiy of Montpellier, revised Oct 2010.
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