Stationary equilibria in bargaining with externalities
This paper studies infinite-horizon bargaining between a seller and multiple buyers when externalities are present. We extend the analysis in Jehiel and Moldovanu by allowing for both pure and mixed equilibria [Jehiel, P., Moldovanu, B., 1995a. Cyclical delay in bargaining with externalities. Rev. Econ. Stud. 62, 619-637]. A characterization of the stationary subgame perfect equilibria in generic games is presented. Equilibria with delay exist only for strong positive externalities. Since each buyer receives a positive payoff when the seller makes an agreement with some other buyer, positive externalities induce a war of attrition between buyers.
Year of publication: |
2009
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Authors: | Björnerstedt, Jonas ; Westermark, Andreas |
Published in: |
Games and Economic Behavior. - Elsevier, ISSN 0899-8256. - Vol. 65.2009, 2, p. 318-338
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Publisher: |
Elsevier |
Subject: | Bargaining Externalities Delay |
Saved in:
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