A continuous-time model of bilateral bargaining

• 成果类型: Article
• 署名作者: Ortner, Juan
• 署名单位: Boston University
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2018.12.001
• 发表日期: 2019
• 页码: 720-733
• 关键词: Bargaining; continuous-time games; Time-varying bargaining power

摘要

This paper constructs a continuous-time model of bilateral bargaining to study how fluctuations in bargaining power affect the outcomes of negotiations. The paper deals with the technical complexities that arise when modeling games in continuous time by building strategy restrictions into the equilibrium definition. These restrictions select a unique equilibrium, which is characterized by a system of ordinary differential equations. This unique equilibrium corresponds to the limiting subgame perfect equilibrium of discrete-time bargaining games with frequent offers. (C) 2018 Elsevier Inc. All rights reserved.