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We experimentally investigate the relevance of (asymmetric) outside options in ultimatum bargaining. Building on the generalized equity principle formulated by Selten (1978) we derive three different equity rules. These equity rules can explain 43% of all o ers. Our within-subject design allows...
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to reject given markups in renegotiations than in negotiations. We do not find that these effects are stronger when the …
Persistent link: https://www.econbiz.de/10010342843
In this paper we analyze how ratification uncertainty impacts the optimal terms of international environmental agreements (IEAs). We relax the frequent assumption of countries as unitary actors by modeling the ratification stage through uncertain preferences of a ratifying agent (e.g. the...
Persistent link: https://www.econbiz.de/10010339399
relational contracts are repeatedly newly negotiated during relationships. Negotiations take place with positive probability and …
Persistent link: https://www.econbiz.de/10010336791
We rationalize a special type of sharing information which can typically be found in markets for occupational disability insurances. There, firms share information about acceptances and rejections of an applicant. We set up a multiple-step signalling model with uninformed agents and endogenize...
Persistent link: https://www.econbiz.de/10010336270
For a repeated procurement problem, we compare two stylized negotiating cultures which differ in how the buyer uses an entrant to exert pressure on the incumbent resembling U.S. style and Japanese style procurement. In each period, the suppliers are privately informed about their production...
Persistent link: https://www.econbiz.de/10010490631
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We analyze optimal labor contracts when the worker is inequity averse towards the employer. Welfare is maximized for an equal sharing rule of surplus between the worker and the firm. That is, profit sharing is optimal even if effort is contractible. If the firm can make a take-it-or leave-it...
Persistent link: https://www.econbiz.de/10010341624