Cooperative Games in Strategic Form

29 Pages Posted: 16 Jul 2008

See all articles by Sergiu Hart

Sergiu Hart

Hebrew University of Jerusalem - Center for the Study of Rationality

Andreu Mas-Colell

Universitat Pompeu Fabra

Date Written: May 15, 2008

Abstract

In this paper we view bargaining and cooperation as an interaction superimposed on a strategic form game. A multistage bargaining procedure for N players, the "proposer commitment" procedure, is presented. It is inspired by Nash's two-player variable-threat model; a key feature is the commitment to "threats." We establish links to classical cooperative game theory solutions, such as the Shapley value in the transferable utility case. However, we show that even in standard pure exchange economies the traditional coalitional function may not be adequate when utilities are not transferable.

Keywords: Bargaining, Commitment, Nash variable threat

JEL Classification: C7, D5, D7

Suggested Citation

Hart, Sergiu and Mas-Colell, Andreu, Cooperative Games in Strategic Form (May 15, 2008). Available at SSRN: https://ssrn.com/abstract=1161035 or http://dx.doi.org/10.2139/ssrn.1161035

Sergiu Hart

Hebrew University of Jerusalem - Center for the Study of Rationality ( email )

Feldman Building
Givat-Ram
Jerusalem, 91904
Israel
+972-2-6584135 (Phone)
+972-2-6513681 (Fax)

HOME PAGE: http://www.ma.huji.ac.il/~hart

Andreu Mas-Colell (Contact Author)

Universitat Pompeu Fabra ( email )

Ramon Trias Fargas 25-27
Barcelona, 08005
Spain
(34-3) 542 20 58 (Phone)
(34-3) 542 12 23 (Fax)

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