Rubinstein Bargaining with Two-Sided Options

J. Sakovics, C. Ponsati

Research output: Working paper

Abstract

In this note we show that if in the standard Rubinstein model both players are allowed to leave the negotiation after a rejection, in which case they obtain a payoff of zero, then there exist a continuum of subgame-perfect equilibrium outcomes, including some which involve significant delay. We also fully characterize the case in which, upon quitting, the players can take an outside option of positive value.
Original languageEnglish
PublisherUnitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC)
Publication statusPublished - 1995

Publication series

NameUFAE and IAE Working Papers

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