Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/85002 
Year of Publication: 
2012
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods No. 2012/12
Publisher: 
Max Planck Institute for Research on Collective Goods, Bonn
Abstract: 
We analyze a bargaining protocol recently proposed in the literature vis-à-vis unconstrained negotiation. This new mechanism extracts gains from trade inherent in the differing valuation of two parties towards various issues where conflict exists. We assess the role of incomplete vs. complete information in the efficiency achieved by this new mechanism and by unconstrained negotiation. We find that unconstrained negotiation does best under a situation of complete information where the valuations of both bargaining parties are common knowledge. Instead, the newly proposed mechanism does best in a situation with incomplete information. The sources of inefficiencies in each of the two cases arise from the different strategic use of the available information.
Document Type: 
Working Paper

Files in This Item:
File
Size





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