Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: Mar, 1995, Volume 63, Issue 2

A Stochastic Model of Sequential Bargaining with Complete Information<371:ASMOSB>2.0.CO;2-C
p. 371-399

Antonio Merlo, Charles Wilson

We consider a $k$-player sequential bargaining model in which the size of the cake and the order in which players move follow a general Markov process. For games in which one agent makes an offer in each period and agreement must be unanimous, we characterize the sets of subgame perfect and stationary subgame perfect payoffs. With these characterizations, we investigate the uniqueness and efficiency of the equilibrium outcomes, the conditions under which agreement is delayed, and the advantage to proposing. Our analysis generalizes many existing results for games of sequential bargaining which build on the work of Stahl (1972), Rubinstein (1982), and Binmore (1987).

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