While actual bargaining features many issues and decision making on the order in which issues are negotiated and resolved, the typical models of bargaining do not. Instead, they have either a single issue or many issues resolved in some fixed order, typically simultaneously. This paper shows...

We discuss a competitive (labor) market where firms face capacity constraints and individuals differ according to their productivity. Firms offer two-dimensional contracts like wage and task level. Then workers choose firms and contracts. Workers might be rationed if the number of applicants...

This paper considers bargaining with one-sided private information and alternating offers where an agreement specifies both a transfer and an additional (sorting) variable. Moreover, both sides can propose menus. We show that for a subset of parameters the alternating-offer game has a unique...

A mechanism that is both efficient and incentive compatible in the Bayesian-Nash sense is shown to be payoff-equivalent to a Groves mechanism at the point in time when each agent has just acquired his private information. This equivalence result simplifies the question of whether or not an...

A well-known result in incentive theory is that for a very broad class of decision problems, there is no mechanism which achieves truth-telling in dominant strategies, efficiency and budget balancedness (or first best implementability). On the contrary, Mitra and Sen (1998), prove that linear...

We analyze an infinite horizon model where a seller who owns an indivisible unit of a good for sale has incomplete information about the state of the world that determines not only the demand she faces but also her own valuation for the good. Over time, she randomly meets potential buyers who...

Suppose that a firm has several owners and that the future is uncertain in the sense that one out of many different states of nature will realize tomorrow. An owner’s time preference and risk attitude will determine the importance he places on payoffs in the different states. It is a...

This paper examines the efficiency of the outside labor market in inducing optimal managerial behavior in the presence of learning. It shows that the incentives provided by the market can be more efficient than the original analysis of Holmström [6] would suggest. Moreover, under a mild...

A fundamental problem in public finance is that of allocating a given budget to financing the provision of public goods (education, transportation, police, etc.). In this paper it is established that when admissible preferences are those representable by continuous and increasing utility...

A feasible alternative x is a strong Condorcet winner if for every other feasible alternative y there is some majority coalition that prefers x to y. Let <InlineEquation ID="Equ1"> <EquationSource Format="TEX"><![CDATA[${\cal L}_{C}$]]></EquationSource> </InlineEquation> (resp., <InlineEquation ID="Equ2"> <EquationSource Format="TEX"><![CDATA[$\wp_{C})$]]></EquationSource> </InlineEquation> denote the set of all profiles of linear (resp., merely asymmetric) individual preference relations for which a strong Condorcet...</equationsource></inlineequation></equationsource></inlineequation>