On the Ranking of Bilateral Bargaining Opponents
We fix the status quo (Q) and one of the bilateral bargaining agents to examine how shifting the opponent.s ideal point (type) away from Q in a unidimensional space affects the Nash and Kalai-Smorodinsky bargaining solutions when opponents differ only in their ideal points. The results are similar for both solutions. As anticipated, the bargainer whose ideal point is farthest from Q prefers a opponent whose ideal is closest to her own. A similar intuitive ranking emerges for the player closest to Q when opponent\'s preferences exhibit increasing absolute risk aversion. However, if the opponent\'s preferences exhibit decreasing absolute risk aversion (DARA), the player closest to Q prefers a more extreme opponent. This unintuitive result arises for opponents with DARA preferences because the farther their ideal point is from Q, the easier they are to satisfy.
|Date of creation:||2005|
|Date of revision:||2005|
|Contact details of provider:|| Postal: 75 University Ave. West, Waterloo, Ontario, N2L 3C5|
Phone: (519) 884-0710 ext 2056
Fax: (519) 884-0201
Web page: http://www.wlu.ca/sbe/economics/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gans, Joshua S. & Smart, Michael, 1996. "Majority voting with single-crossing preferences," Journal of Public Economics, Elsevier, vol. 59(2), pages 219-237, February.
- Alejandro Saporiti & Fernando Tohmé, 2006.
"Single-Crossing, Strategic Voting and the Median Choice Rule,"
Social Choice and Welfare,
Springer;The Society for Social Choice and Welfare, vol. 26(2), pages 363-383, April.
- Alejandro Saporiti & Fernando Tohmé, 2003. "Single-Crossing, Strategic Voting and the Median Choice Rule," CEMA Working Papers: Serie Documentos de Trabajo. 237, Universidad del CEMA.
- Kalai, Ehud & Smorodinsky, Meir, 1975. "Other Solutions to Nash's Bargaining Problem," Econometrica, Econometric Society, vol. 43(3), pages 513-518, May.
- Volij, Oscar & Winter, Eyal, 2002. "On risk aversion and bargaining outcomes," Games and Economic Behavior, Elsevier, vol. 41(1), pages 120-140, October.
- Oscar Volij, 1999. "On Risk Aversion and Bargaining Outcomes," Economic theory and game theory 010, Oscar Volij.
- Volij, Oscar & Winter, Eyal, 2002. "On Risk Aversion and Bargaining Outcomes," Staff General Research Papers Archive 10130, Iowa State University, Department of Economics.
- Kobberling, Veronika & Peters, Hans, 2003. "The effect of decision weights in bargaining problems," Journal of Economic Theory, Elsevier, vol. 110(1), pages 154-175, May.
- Peters Hans & Köbberling Vera, 2000. "The Effect of Decision Weights in Bargaining Problems," Research Memorandum 037, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
- Maria Gallego, David Scoones, 2005. "The Art of Compromise," Working Papers eg0042, Wilfrid Laurier University, Department of Economics, revised 2005.
- Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
- Alesina, Alberto & Rosenthal, Howard, 1996. "A Theory of Divided Government," Econometrica, Econometric Society, vol. 64(6), pages 1311-1341, November.
- Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, number 9780195102680.
- Kannai, Yakar, 1977. "Concavifiability and constructions of concave utility functions," Journal of Mathematical Economics, Elsevier, vol. 4(1), pages 1-56, March.
- Thomson, William, 1994. "Cooperative models of bargaining," Handbook of Game Theory with Economic Applications,in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 2, chapter 35, pages 1237-1284 Elsevier.
- Thomson, W., 1989. "Cooperative Models Of Bargaining," RCER Working Papers 177, University of Rochester - Center for Economic Research (RCER).
- Susan Athey, 2002. "Monotone Comparative Statics under Uncertainty," The Quarterly Journal of Economics, Oxford University Press, vol. 117(1), pages 187-223.
- Athey, Susan, 2002. "Monotone Comparative Statics Under Uncertainty," Scholarly Articles 3372263, Harvard University Department of Economics.
- Milgrom, Paul & Shannon, Chris, 1994. "Monotone Comparative Statics," Econometrica, Econometric Society, vol. 62(1), pages 157-180, January.
- Milgrom, P. & Shannon, C., 1991. "Monotone Comparative Statics," Papers 11, Stanford - Institute for Thoretical Economics.
- de Koster, R. & Peters, H. J. M. & Tijs, S. H. & Wakker, P., 1983. "Risk sensitivity, independence of irrelevant alternatives and continuity of bargaining solutions," Mathematical Social Sciences, Elsevier, vol. 4(3), pages 295-300, July.
- de Koster, R. & Peters, H. & Tijs, S.H. & Wakker, P., 1983. "Risk sensitivity, independence of irrelevant alternatives and continuity of bargaining solutions," Other publications TiSEM ca1db065-9070-4741-9bbe-0, Tilburg University, School of Economics and Management.
- Thomson, William, 1987. "Monotonicity of bargaining solutions with respect to the disagreement point," Journal of Economic Theory, Elsevier, vol. 42(1), pages 50-58, June.
- Hans Peters & Walter Bossert, 2002. "Efficient solutions to bargaining problems with uncertain disagreement points," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 19(3), pages 489-502.
- Alvin E Roth, 2008. "Axiomatic Models of Bargaining," Levine's Working Paper Archive 122247000000002376, David K. Levine. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:wlu:wpaper:eg0043. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Andrei Kovacsik)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.