Efficiency Does Not Imply Immediate Agreement
Gul (Econometrica, 1989) introduces a non-cooperative bargaining procedure and claims that the payoffs of the resulting efficient stationary subgame perfect equilibria are close to the Shapley value of the underlying transferable utility game (when the discount factor is close to 1). We exhibit here an example showing that efficiency, even for strictly super-additive games, does not imply that all meetings end in agreement. Thus efficiency does not suffice to get Gul's result.
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- Hart, Oliver D. & Moore, John, 1990.
"Property Rights and the Nature of the Firm,"
3448675, Harvard University Department of Economics.
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Economics Working Papers
114, Department of Economics and Business, Universitat Pompeu Fabra, revised Feb 1995.
- Winter, Eyal, 1994. "The Demand Commitment Bargaining and Snowballing Cooperation," Economic Theory, Springer, vol. 4(2), pages 255-73, March.
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