A Model of Bargaining with the Possibility of Arbitration

36 Pages Posted: 8 Feb 1998

See all articles by Paola Manzini

Paola Manzini

University of St. Andrews - School of Economics and Finance; Institute for the Study of Labor (IZA)

Marco Mariotti

University of Exeter Business School - Department of Economics

Date Written: October 1997

Abstract

We consider an alternating offer bargaining model in which the players may agree to call in an arbitrator in case of disagreement. The main message of our study is that the mere presence of an arbitrator - who can only become active with the consent of both parties - in the background of negotiations may entirely drive their outcome. We discuss the implications of this result both for theories of arbitration and for the interpretation of cooperative bargainining solutions.

JEL Classification: C78, K49

Suggested Citation

Manzini, Paola and Mariotti, Marco, A Model of Bargaining with the Possibility of Arbitration (October 1997). Available at SSRN: https://ssrn.com/abstract=57949 or http://dx.doi.org/10.2139/ssrn.57949

Paola Manzini (Contact Author)

University of St. Andrews - School of Economics and Finance ( email )

North St
Saint Andrews, Fife KY16 9AJ
United Kingdom

HOME PAGE: http://www.st-andrews.ac.uk/~pm210/

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Marco Mariotti

University of Exeter Business School - Department of Economics ( email )

Streatham Court
Rennes Drive
Exeter EX4 4RJ
United Kingdom
+01392 263219 (Phone)
+01392 263242 (Fax)

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