Majority Rule in a Stochastic Model of Bargaining

32 Pages Posted: 2 May 2001

See all articles by Hulya Eraslan

Hulya Eraslan

Rice University

Antonio Merlo

University of Pennsylvania - Department of Economics; Rice University

Date Written: 2001

Abstract

In this paper we consider multilateral stochastic bargaining models with general agreement rules. For n-player games where in each period a player is randomly selected to allocate a stochastic level of surplus and q (less than or equal to n) players have to agree on a proposal to induce its acceptance, we characterize the set of stationary subgame perfect equilibrium payoffs and establish their existence. We show that for agreement rules other than the unanimity rule, the equilibrium payoffs need not be unique. Furthermore, even when the equilibrium is unique, it need not be efficient.

Keywords: Noncooperative Bargaining, Voting Rules, Stochastic Games

JEL Classification: C73, C78, D70

Suggested Citation

Eraslan, Hulya and Merlo, Antonio M., Majority Rule in a Stochastic Model of Bargaining (2001). Available at SSRN: https://ssrn.com/abstract=267780 or http://dx.doi.org/10.2139/ssrn.267780

Hulya Eraslan

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/

Antonio M. Merlo (Contact Author)

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-7933 (Phone)
215-573-2057 (Fax)

HOME PAGE: http://www.ssc.upenn.edu/~merloa

Rice University ( email )

6100 South Main Street
Houston, TX 77005-1892
United States

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