Bargaining with Linked Disagreement Points

22 Pages Posted: 18 Feb 2011 Last revised: 9 Oct 2011

See all articles by Justin Leroux

Justin Leroux

HEC Montreal - Institute of Applied Economics; CIRANO

Walid Marrouch

Lebanese American University; CIRANO; Economic Research Forum

Date Written: February 16, 2011


In the context of bilateral bargaining,we deal with issue linkage by developing a two-issue-two-players cooperative bargaining model. The axioms we propose focus on the role of the disagreement points. A family of bargaining rule stands out: the monotonic equal net ratio solutions. These solutions point to Pareto efficient outcomes such that the relative gains for players are equal across issues and reward the players for improving their bargaining power over each issue. We discuss our results in light of international trade and environmental negotiations, which are often put on the bargaining table in a linked fashion.

Keywords: Multi-Issue Bargaining, Issue Linkages, Axiomatic Solutions, Disagreement Point

JEL Classification: C78, Q56

Suggested Citation

Leroux, Justin and Marrouch, Walid, Bargaining with Linked Disagreement Points (February 16, 2011). CIRANO - Scientific Publication No. 2011s-30, Available at SSRN: or

Justin Leroux

HEC Montreal - Institute of Applied Economics ( email )

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Walid Marrouch (Contact Author)

Lebanese American University ( email )

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