The Bargaining Problem¶
Nash, J. F. (1950). The Bargaining Problem. Econometrica, 18(2), 155-162.
Cited by¶
2 citations across 2 artifacts.
Each citation links to the sentence it supports in the citing article.
Primes¶
- Bargaining Power
- Bargaining power is a relational advantage that lets one party move the terms of an exchange toward itself because failing to reach agreement costs it less than it costs the other side.
This sourceEstablishes the disagreement point and the individual-rationality constraint that bound an attainable division of joint surplus, so each party's fallback sets a floor beneath which it will not settle and improving that fallback shifts the solution toward it.
Supported in partVerified against the publisher's abstract
Nash 1950 supplies only the frame that a two-person bargaining problem has a determinate solution derived from assumptions about the parties; its abstract states nothing about asymmetric disagreement costs or about power moving terms.
“A new treatment is presented of a classical economic problem, one which occurs in many forms, as bargaining, bilateral monopoly, etc. It may also be regarded as a nonzero-sum two-person game. In this treatment a few general assumptions are made concerning the behavior of a single individual and of a group of two individuals in certain economic environments. From these, the solution (in the sense of this paper) of …”
- Bargaining power is a relational advantage that lets one party move the terms of an exchange toward itself because failing to reach agreement costs it less than it costs the other side.
- Conditional Access
- The reasoning also predicts a substrate-independent counter-strategy: outside options break the leverage, which is why competition law, legal-aid provision, multilateral coalitions, and unbundling mandates all fall in the same family of structural countermeasures despite operating in different domains.
This sourceFoundational bargaining theory in which acceptance is governed by comparison of a proposed agreement's value against each party's outside option (disagreement point).
Supported in partVerified against the publisher's abstract
Nash 1950 supplies the general principle that a bargaining outcome is judged against the parties' outside options; its abstract does not state the binary package or the condition V - d > W.
“In this treatment a few general assumptions are made concerning the behavior of a single individual and of a group of two individuals in certain economic environments. From these, the solution (in the sense of this paper) of classical problem may be obtained. In the terms of game theory, values are found for the game.”
- The reasoning also predicts a substrate-independent counter-strategy: outside options break the leverage, which is why competition law, legal-aid provision, multilateral coalitions, and unbundling mandates all fall in the same family of structural countermeasures despite operating in different domains.
Verification¶
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