Multilateral & Bargaining in Networks: On the Prevalence of Inefficiencies

• 成果类型: Article
• 署名作者: Lee, Joosung
• 署名单位: University of Edinburgh
• 刊物名称: OPERATIONS RESEARCH
• ISSN/ISSBN: 0030-364X
• DOI: 10.1287/opre.2018.1725
• 发表日期: 2018
• 页码: 1204-1217
• 关键词: COMMUNICATION-NETWORKS; equilibrium; EFFICIENCY; games; delay

摘要

We introduce a new noncooperative multilateral bargaining model for network-restricted environments in which players can bargain only with their neighbors. The main theorem characterizes a condition on network structures for efficient equilibria. If the underlying network is either complete or circular, an efficient stationary subgame perfect equilibrium exists for all discount factors-all the players always try to reach an agreement as soon as practicable, and hence no strategic delay occurs. In any other network, however, an efficient equilibrium is impossible if a discount factor is greater than a certain threshold, as some players strategically delay an agreement. We also provide an example of a Braess-like paradox, in which network improvements decrease social welfare.