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Bargaining and negative externalities

Authordc.contributor.authorLaengle Scarlazetta, Sigifredo 
Authordc.contributor.authorLoyola Fuentes, Gino es_CL
Cita de ítemdc.identifier.citationOptim Lett (2012) 6:421–430es_CL
Identifierdc.identifier.otherDOI 10.1007/s11590-010-0267-x
General notedc.descriptionArtículo de publicación ISIes_CL
Abstractdc.description.abstractTwo important issues in distributive bargaining theory are, first, the conditions under which a negotiation breakdown occurs, and second, what and how source of parties’ bargaining powers influences the properties of a possible agreement. Research based on classicNash’s demand game has explored both questions by sophisticating the original game a lot. As an attempt to deal with both issues under a simpler framework, we propose a modification of the Nash demand game in which bargainers suffer negative externalities proportional to the share of the surplus captured by their rival. It is shown that the negotiator experiencing a relatively high externality level has greater bargaining power and thus, appropriates a larger proportion of the surplus at stake. However, if externality levels are sufficiently high, bargaining powers become incompatible and a negotiation breakdown emerges from the bargaining process. We compare our results with the previous literature, and argue that they can be especially relevant in negotiations held under highly polarized environments.es_CL
Títulodc.titleBargaining and negative externalitieses_CL
Document typedc.typeArtículo de revistaes_CL

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