Bargaining, Coalitions, and Competition
We study a Gale-like matching model in a large exchange economy, in which trade takes place through non-cooperative bargaining in coalitions of finite size. Under essentially the same conditions of core equivalence, we show that the strategic equilibrium outcomes of our model coincide with the Walrasian allocations of the economy. Our method of proof makes use of the theory of the core. With respect to previous work, our positive implementation result applies to a substantially larger class of economies: the model relaxes differentiability and convexity of preferences, and also admits an arbitrary number of divisible and indivisible goods.
|Date of creation:||Jun 1996|
|Date of revision:||May 1999|
|Publication status:||Published in Economic Theory 15:279-296 (2000)|
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