You are not currently logged in.
Access JSTOR through your library or other institution:
If You Use a Screen ReaderThis content is available through Read Online (Free) program, which relies on page scans. Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
The Nash Bargaining Solution in Economic Modelling
Ken Binmore, Ariel Rubinstein and Asher Wolinsky
The RAND Journal of Economics
Vol. 17, No. 2 (Summer, 1986), pp. 176-188
Stable URL: http://www.jstor.org/stable/2555382
Page Count: 13
You can always find the topics here!Topics: Strategic bargaining, Economic models, Risk aversion, Games, Axioms, Political attitudes, Utility functions, Modeling, Bargaining theory, Macroeconomic modeling
Were these topics helpful?See somethings inaccurate? Let us know!
Select the topics that are inaccurate.
Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Preview not available
This article establishes the relationship between the static axiomatic theory of bargaining and the sequential strategic approach to bargaining. We consider two strategic models of alternating offers. The models differ in the source of the incentive of the bargaining parties to reach agreement: the bargainers' time preference and the risk of breakdown of negotiation. Each of the models has a unique perfect equilibrium. When the motivation to reach agreement is made negligible, in each model the unique perfect equilibrium outcome approaches the Nash bargaining solution with utilities that reflect the incentive to settle and with the proper disagreement point chosen. The results provide a guide for the application of the Nash bargaining solution in economic modelling.
The RAND Journal of Economics © 1986 RAND Corporation