Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/231488 
Year of Publication: 
2021
Series/Report no.: 
ECONtribute Discussion Paper No. 063
Publisher: 
University of Bonn and University of Cologne, Reinhard Selten Institute (RSI), Bonn and Cologne
Abstract: 
This paper analyzes a continuous-time Coase setting with finite horizon, interdependent values, and different discount rates. Our full characterization of equilibrium behavior permits studying how patience shapes the bargaining outcome. We obtain that (i) the seller's commitment problem persists even when she is fully patient, (ii) making the seller more impatient may increase equilibrium prices, (iii) when adverse selection is not strong, the buyer is ex-post better off when he is more impatient, and (iv) when discounting is time-dependent, episodes where the seller or the buyer have a high discount rate feature a large probability of trade, but only periods with high buyer discounting lead to a fast price decline.
Subjects: 
Bargaining
one-sided offers
different discount factors
JEL: 
C78
D82
Document Type: 
Working Paper

Files in This Item:
File
Size
528.65 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.