Uniqueness of Stationary Equilibrium Payoffs in Coalitional Bargaining

32 Pages Posted: 8 Jun 2011

See all articles by Hulya Eraslan

Hulya Eraslan

Rice University

Andrew McLennan

University of Queensland - School of Economics

Date Written: June 8, 2011

Abstract

We study a model of sequential bargaining in which, in each period before an agreement is reached, the proposer’s identity is randomly determined, the proposer suggests a division of a pie of size one, each other agent either approves or rejects the proposal, and the proposal is implemented if the set of approving agents is a winning coalition for the proposer. The theory of the fixed point index is used to show that stationary equilibrium expected payoffs of this coalitional bargaining game are unique. This generalizes Eraslan (2002) insofar as: (a) there are no restrictions on the structure of sets of winning coalitions; (b) different proposers may have different sets of winning coalitions; (c) there may be a positive probability that no proposer is selected.

Keywords: noncooperative bargaining, multilateral bargaining, TU games, simple games, coalitions, legislative bargaining, fixed points, fixed point index

JEL Classification: D71

Suggested Citation

Eraslan, Hulya and McLennan, Andrew, Uniqueness of Stationary Equilibrium Payoffs in Coalitional Bargaining (June 8, 2011). Available at SSRN: https://ssrn.com/abstract=1860085 or http://dx.doi.org/10.2139/ssrn.1860085

Hulya Eraslan (Contact Author)

Rice University ( email )

Department of Economics MS-22
Rice University P.O Box 1892
Houston, TX Texas 77251-1892
United States
7133483453 (Phone)

HOME PAGE: http://he6.web.rice.edu/

Andrew McLennan

University of Queensland - School of Economics ( email )

Brisbane, QLD 4072
Australia

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