A continuous-time model of multilateral bargaining

Journal Article (Journal Article)

We propose a finite-horizon continuous-time framework for coalitional bargaining, in which players can make offers at random discrete times. In our model: (i) expected payoffs in Markov perfect equilibrium (MPE) are unique, generating sharp predictions and facilitating comparative statics; and (ii) MPE are the only subgame perfect Nash equilibria (SPNE) that can be approximated by SPNE of nearby discrete-time bargaining models. We investigate the limit MPE payoffs as the time horizon goes to infinity and players get infinitely patient. In convex games, we establish that the set of these limit payoffs achievable by varying recognition rates is exactly the core of the characteristic function.

Full Text

Duke Authors

Cited Authors

  • Ambrus, A; En Lu, SE

Published Date

  • January 1, 2015

Published In

Volume / Issue

  • 7 / 1

Start / End Page

  • 208 - 249

Electronic International Standard Serial Number (EISSN)

  • 1945-7685

International Standard Serial Number (ISSN)

  • 1945-7669

Digital Object Identifier (DOI)

  • 10.1257/mic.20100029

Citation Source

  • Scopus