This paper extends the work of Ray and Vohra [3]. It ascertains which partitions of players will emerge and what actions will these players choose under each partition, when they can sign binding agreements and their actions have externalities. The emphasis, however, is placed on situations with...

This paper defines "negotiation-proof Nash equilibrium'', a notion that applies to environments where players can negotiate openly and directly prior to the play of a noncooperative game. It recognizes the possibility that a group of self-interested players may choose, voluntarily and without...

In this paper we first explore the predictive power of the solution notion called conservative stable standard of behaviour (CSSB), introduced by Greenberg (1990) in environments with farsighted players (as modelled in Xue (1998)) as intuitively it is quite nice. Unfortunately, we find that CSSB...

We propose a class of sharing schemes for the distribution of the gains from cooperation for coalition games with externalities. In the context of the partition function, it is shown that any member of this class of sharing schemes leads to the same set of stable coalitions in the sense of...

We develop a model of wage determination with private information, in which the union has the option to delegate the wage bargaining to either surplus-maximizing delegates or to wage-maximizing delegates (such as senior union members). We show that the wage outcome in case of surplus-maximizing...

In this paper we view bargaining and cooperation as an interaction superimposed on a game in strategic form. A multistage bargaining procedure for N players, the "proposer commitment" procedure, is presented. It is inspired by Nash's two-player variable-threat model; a key feature is the...

We adopt the largest consistent set defined by Chwe (J. of Econ. Theory 63 (1994, 299-235) to predict which coalition structures are possibly stable when prayers are farsighted. We also introduce a refinement. the largest cautious consistent set, based on the assumption that players are...

A widely held belief in financial economics suggests that stock prices always adequately reflect all available information. Price movements away from fundamentals are assumed to occur only infrequently, if at all. „False“ prices are supposed to be corrected by the counter-actions of...

In games with unequal equilibrium payoffs, concepts of fairness and selfishness often clash. We strucrure the approach to fairness versus selfishness as a struggle between two forces that act aon an individual's behavior.

We develop a two-stage negotiation model to study the impact of costly inspections on both the coalition formation outcome and the per-member payoffs. In the first stage, the players are forming coalitions and inside each coalition formed the members share the coalition benefits. We adopt the...