Threat bargaining problems with correlated beliefs (Q1184751)
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Threat bargaining problems with correlated beliefs (English)
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28 June 1992
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This paper considers a two-person bargaining problem where each player \(i\) chooses and reveals a disagreement point \(d_ i\) from the interval [0,1], the arbitrator chooses a Pareto optimal outcome and each player \(i\) has a belief function \(G_ i\) of acceptance of the final outcome. The author restricts his attention to a bargaining region forming a compact convex subset of the unit square containing (0,0), (1,0) and (0,1). The main result of the paper is: Under a certain specification of belief functions \(G_ i\), (0,0) is a Nash equilibrium in the disagreement revelation game if and only if the arbitrator's bargaining scheme is the Kalai-Smorodinsky solution.
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two-person bargaining
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Nash equilibrium
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disagreement revelation game
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Kalai-Smorodinsky solution
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