On the empirical validity of axioms in unstructured bargaining

• 成果类型: Article
• 署名作者: Navarro, Noemi; Veszteg, Robert F.
• 署名单位: Universite de Bordeaux; Centre National de la Recherche Scientifique (CNRS); Waseda University
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2020.01.003
• 发表日期: 2020
• 页码: 117-145
• 关键词: Bilateral bargaining; experiments; Nash bargaining solution; Equal-division solution; Deal-me-out solution; individual rationality; scale invariance

摘要

We report experimental results and test axiomatic models of unstructured bargaining by checking the empirical relevance of the underlying axioms. Our data support strong efficiency, symmetry, independence of irrelevant alternatives and monotonicity, and reject scale invariance. Individual rationality and midpoint domination are violated by a significant fraction of agreements that implement equal division in highly unequal circumstances. Two well-known bargaining solutions that satisfy the confirmed properties explain the observed agreements reasonably well. The most frequent agreements in our sample are the ones suggested by the equal-division solution. In terms of the average Euclidean distance, the theoretical solution that best explains the data is the deal-me-out solution (Sutton, 1986; Binmore et al., 1989, 1991). Popular solutions that satisfy scale invariance, individual rationality, and midpoint domination, as the well-known Nash or Kalai-Smorodinsky bargaining solutions, perform poorly in the laboratory. (C) 2020 Elsevier Inc. All rights reserved.