Bargaining in Stationary Networks
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Manea_Bargaining in.pdf
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Author(s)
Manea, Mihai
Date Issued
August 2011
Journal
American Economic Review
Publisher
American Economic Association
Citation
Manea, Mihai. “Bargaining in Stationary Networks.” American Economic Review 101.5 (2011): 2042–2080. Web. © 2011 American Economic Association.
Version
Final published version
Abstract
We study an infinite horizon game in which pairs of players connected in a network are randomly matched to bargain. Players who reach agreement are replaced by new players at the same positions in the network. We show that all equilibria are payoff equivalent. The payoffs and the set of agreement links converge as players become patient. Several new concepts—mutually estranged sets, partners, and shortage ratios—provide insights into the relative strengths of the positions in the network. We develop a procedure to determine the limit equilibrium payoffs for all players. Characterizations of equitable and nondiscriminatory networks are also obtained.
MIT Department
Massachusetts Institute of Technology. Department of Economics
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Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
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DOI of Published Version
https://doi.org/10.1257/aer.101.5.2042
