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Perfect Equilibria in a Negotiation Model

Author

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  • Busch, L-A.
  • Wen, Q.

Abstract

An alternating-offers bargaining model in which a normal-form game determines players' payoffs in disagreement periods can have multiple perfect equilibria, provided that players are sufficiently patient. Even though there is perfect information, delay can arise and the length of delay depends only on the payoff structure of the disagreement game and not on the discount factor. On the other hand, not all feasible and individually rational payoffs of the disagreement game can be supported as average payoffs in equilibrium and some negotiation games have a unique perfect equilibrium with immediate agreement. Copyright 1995 by The Econometric Society.
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Suggested Citation

  • Busch, L-A. & Wen, Q., 1991. "Perfect Equilibria in a Negotiation Model," University of Western Ontario, The Centre for the Study of International Economic Relations Working Papers 9108, University of Western Ontario, The Centre for the Study of International Economic Relations.
    • Handle: RePEc:uwo:wocier:9108
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