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Time Inconsistency And Learning In Bargaining Games

Author

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  • Zafer Akin

    (Pennsylvania State University)

Abstract

The literature on time-inconsistent preferences introduced naive, partially naive and sophisticated as types of agents that represent different levels of unawareness of agents' self-control problems. This paper incorporates time-inconsistent players in a sequential bargaining model. We first consider 'naive' agents who never learn about their types and show that bargaining between such a player and a standard exponential agent ends in immediate agreement. The more naive a player, the higher his share. If naive agents can learn their type over time, we show that there is a critical date such that there is no agreement before that date. Hence, existence of time-inconsistent players who can learn as they play the game can be another explanation for delays in bargaining.

Suggested Citation

  • Zafer Akin, 2005. "Time Inconsistency And Learning In Bargaining Games," Game Theory and Information 0507003, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpga:0507003
    Note: Type of Document - pdf; pages: 40
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    Cited by:

    1. is not listed on IDEAS
    2. Jinrui Pan & Craig Webb & Horst Zank, 2013. "Discounting the Subjective Present and Future," Economics Discussion Paper Series 1305, Economics, The University of Manchester.
    3. Claudia Cerrone, 2021. "Doing It When Others Do: A Strategic Model Of Procrastination," Economic Inquiry, Western Economic Association International, vol. 59(1), pages 315-328, January.
    4. Fabian Herweg & Daniel Müller, 2011. "Performance of procrastinators: on the value of deadlines," Theory and Decision, Springer, vol. 70(3), pages 329-366, March.
    5. Borissov, Kirill & Pakhnin, Mikhail & Wendner, Ronald, 2024. "General equilibrium and dynamic inconsistency," Journal of Mathematical Economics, Elsevier, vol. 114(C).
    6. Gans, Joshua S. & Landry, Peter, 2022. "I’m not sure what to think about them: Confronting naive present bias in a dynamic threshold public goods game," Journal of Economic Behavior & Organization, Elsevier, vol. 197(C), pages 195-204.
    7. Akin, Zafer, 2012. "Intertemporal decision making with present biased preferences," Journal of Economic Psychology, Elsevier, vol. 33(1), pages 30-47.
    8. Akin, Zafer, 2009. "Imperfect information processing in sequential bargaining games with present biased preferences," Journal of Economic Psychology, Elsevier, vol. 30(4), pages 642-650, August.
    9. Pan, Jinrui & Webb, Craig S. & Zank, Horst, 2015. "An extension of quasi-hyperbolic discounting to continuous time," Games and Economic Behavior, Elsevier, vol. 89(C), pages 43-55.
    10. Manuel A. Utset, 2023. "Time-Inconsistent Bargaining and Cross-Commitments," Games, MDPI, vol. 14(3), pages 1-21, April.
    11. Sebastian Schweighofer-Kodritsch, 2015. "Time Preferences and Bargaining," STICERD - Theoretical Economics Paper Series /2015/568, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    12. Kim, Jeongbin & Lim, Wooyoung & Schweighofer-Kodritsch, Sebastian, 2020. "Bargaining and Time Preferences: An Experimental Study," Rationality and Competition Discussion Paper Series 254, CRC TRR 190 Rationality and Competition.
    13. Yixuan Shi, 2022. "Dynamic Volunteer's Dilemma with Procrastinators," Working Papers tax-mpg-rps-2022-17, Max Planck Institute for Tax Law and Public Finance.
    14. Marco A. Haan & Dominic Hauck, 2023. "Games with possibly naive present-biased players," Theory and Decision, Springer, vol. 95(2), pages 173-203, August.
    15. Murat Yilmaz, 2018. "An Extended Survey of Time-Inconsistency and Its Applications," Bogazici Journal, Review of Social, Economic and Administrative Studies, Bogazici University, Department of Economics, vol. 32(1), pages 55-73.
    16. Kristal K. Trejo & Ruben Juarez & Julio B. Clempner & Alexander S. Poznyak, 2023. "Non-Cooperative Bargaining with Unsophisticated Agents," Computational Economics, Springer;Society for Computational Economics, vol. 61(3), pages 937-974, March.
    17. Joshua S. Gans & Peter Landry, 2016. "Procrastination in Teams," NBER Working Papers 21891, National Bureau of Economic Research, Inc.
    18. Fahn, Matthias & Seibel, Regina, 2022. "Present bias in the labor market – when it pays to be naive," Games and Economic Behavior, Elsevier, vol. 135(C), pages 144-167.
    19. Haan, Marco & Hauck, Dominic, 2014. "Games With Possibly Naive Hyperbolic Discounters," MPRA Paper 57960, University Library of Munich, Germany.
    20. Lu, Shih En, 2016. "Self-control and bargaining," Journal of Economic Theory, Elsevier, vol. 165(C), pages 390-413.

    More about this item

    Keywords

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    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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