Bargaining for assembly

Sarkar, Soumendu and Gupta, Dhritiman (2022) Bargaining for assembly. Theory and Decision, 95 (02). pp. 229-254. ISSN 1573-7187

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Abstract

We study a multilateral bargaining problem, where the buyer intends to purchase a subset of available items, each owned by a seller. The subset purchased must satisfy a notion of contiguity, which is modeled using graphs. The graph theoretic approach allows us to study different degrees of complementarity and substitutability between items. It also allows us to examine how degrees of complementarity and substitutability affect the share of surplus obtained by the buyer in the equilibrium of the bargaining game. We characterize necessary and sufficient conditions on the graphs for the buyer to extract full surplus in subgame perfect equilibrium. When the conditions are not met, we provide upper bounds on the equilibrium surplus share of the buyer.

Item Type: Article
Keywords: Assembly | Bargaining | Competition | Complementarity | Contiguity | Holdout
Subjects: Social Sciences and humanities > Social Sciences > Social Sciences (General)
JGU School/Centre: Jindal School of Government and Public Policy
Depositing User: Amees Mohammad
Date Deposited: 02 Nov 2022 10:20
Last Modified: 31 Aug 2023 04:13
Official URL: https://doi.org/10.1007/s11238-022-09917-5
URI: https://pure.jgu.edu.in/id/eprint/4748

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