Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/45428 
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dc.contributor.authorKoçkesen, Leventen
dc.contributor.authorGerratana, Emanueleen
dc.date.accessioned2010-11-03-
dc.date.accessioned2011-05-09T09:34:35Z-
dc.date.available2011-05-09T09:34:35Z-
dc.date.issued2009-
dc.identifier.urihttp://hdl.handle.net/10419/45428-
dc.description.abstractIt is well known that non-renegotiable contracts with third parties may have an effect on the outcome of a strategic interaction and thus serve as a commitment device. We address this issue when contracts are renegotiable. More precisely, we analyze the equilibrium outcomes of twostage games with renegotiation-proof third-party contracts in relation to the equilibrium outcomes of the same game without contracts. We assume that one of the parties in the contractual relationship is unable to observe everything that happens in the game when played by the other party. This implies that contracts are incomplete and we show that such incompleteness restricts the set of equilibrium outcomes to a subset of Nash equilibrium outcomes of the game without contracts. Introducing renegotiation, in general, imposes further constraints and in some games implies that only subgame perfect equilibrium outcomes can be supported. However, there is a large class of games in which non-subgame perfect equilibriumoutcomes can also be supported, and hence, third-party contracts still have strategic implications even when they are renegotiable.en
dc.language.isoengen
dc.publisher|aTÜSİAD-Koç University Economic Research Forum |cIstanbulen
dc.relation.ispartofseries|aWorking Paper |x0908en
dc.subject.jelC72en
dc.subject.jelC78en
dc.subject.jelD86en
dc.subject.jelL13en
dc.subject.ddc330en
dc.subject.keywordThird-Party Contractsen
dc.subject.keywordStrategic Delegationen
dc.subject.keywordIncomplete Contractsen
dc.subject.keywordRenegotiationen
dc.subject.stwUnvollständiger Vertragen
dc.subject.stwNash-Gleichgewichten
dc.subject.stwNichtkooperatives Spielen
dc.subject.stwTheorieen
dc.titleStrategic effects of incomplete and renegotiation-proof contracts-
dc.typeWorking Paperen
dc.identifier.ppn638341078en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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