Nash meets Rubinstein in final-offer arbitration
Name
Yildiz_Nash meets.pdf
Size
310.26 KB
Format
Adobe PDF
Checksum (MD5)
531e9c8d4d7a4ab33c7afe52d8b37fbb
Author(s)
Yildiz, Muhamet
Date Issued
November 2010
Journal
Economics Letters
Publisher
Elsevier
Citation
Yildiz, Muhamet. “Nash Meets Rubinstein in Final-Offer Arbitration.” Economics Letters 110, no. 3 (March 2011): 226–30.
Version
Author's final manuscript
Abstract
I consider a final-offer arbitration model in which the offers are submitted sequentially, the parties are allowed to accept offers, and the arbitrator maximizes Nash's social welfare function. I show that backwards induction in this three-period model leads to the subgame-perfect equilibrium outcome of Rubinstein's infinite-horizon alternating-offer bargaining game.
MIT Department
Massachusetts Institute of Technology. Department of Economics
Terms of Use
Creative Commons Attribution-Noncommercial-NoDerivatives
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.1016/j.econlet.2010.10.020
