This experimental study investigates two bargaining games with twosided incomplete information between a seller and a buyer. In the first game with no outside options many subjects do not use the incomplete information to their advantage as predicted. We find that a model with adjusting priors...

This paper studies asset markets where buyers of assets do not inherit private information from previous owners and must learn asset quality over time. Imperfect information transmission reduces asymmetric information, but also reduces the trading volume, prices and efficiency. This result is...

Two notions of stability, ex ante stability and Bayesian stability, are investigated in a matching model with non-transferrable utility, interdependent preferences, and one-sided incomplete information. Ex ante stable matching-outcomes are unblocked for every belief on the blocking partner's...

This paper considers evolutionarily stable strategies (ESS) in a take-it-or-leave-it offer bargaining game with incomplete information. We find responders reject offers which yield a higher positive material payoff than their outside option. Proposers, in turn, make more attractive offers than...

In this paper, we introduce a solution concept generalizing the Harsanyi non-transferable utility (NTU) value to cooperative games with incomplete information. The so-defined S-solution is characterized by virtual utility scales that extend the Harsanyi-Shapley fictitious weighted utility...

This study quantifies bargaining power in supply-side negotiations with incomplete information, where car dealers negotiate inventory prices with large sellers at wholesale used-car auctions. We measure an agent's bargaining power in an incomplete-information setting as the fraction of the...

This paper extends the discussion of the relationship between Bayesian stability and Bayesian efficiency in Liu(2020). We focus on the worst possible case for workers, in which firms offer workers wages exactly opposite to workers’ initial payoffs, so that workers will always enjoy a zero...

We study a one-to-one two-sided matching market in which each man has a common value for all women and a private value specific to each woman. We introduce a new mechanism, called a proposing mechanism, which is a novel interpretation of the deferred acceptance mechanism. We show that these...