Communication in bargaining over decision rights |
| |
| Institution: | 1. Research Group in Economic Analysis, Facultade de Económicas, Universidade de Vigo, 36310, Vigo, Pontevedra, Spain;2. Universitat Autònoma de Barcelona and Barcelona Graduate School of Economics, Departament d''Economia i d''Història Econòmica, Campus UAB, Edifici B, 08193, Bellaterra, Barcelona, Spain;3. Instituto de Matemática Aplicada de San Luis, Universidad Nacional de San Luis and CONICET, Ejército de los Andes 950, 5700, San Luis, Argentina;1. Murat Sertel Institute for Advanced Economic Studies, Istanbul Bilgi University, Turkey;2. IMW, Bielefeld University, Postbox 100131, 33501 Bielefeld, Germany;1. Faculty of Industrial Engineering and Management, Technion – Israel Institute of Technology, Israel;2. Nuffield College and Department of Economics, University of Oxford, United Kingdom;1. University of Oxford, Dept. of Computer Science, Wolfson Building, Parks Road, Oxford OX1 3QD, UK;2. Utrecht University, Department of Information and Computing Science, PO Box 80089, 3508TB Utrecht, The Netherlands;1. Yale University, 30 Hillhouse Ave., New Haven, CT 06520, USA;2. National University of Singapore, Singapore 117570, Singapore;3. HEC Paris, 78351 Jouy-en-Josas, France;1. Stockholm School of Economics, Box 6501, S-113 83 Stockholm, Sweden;2. Hanken School of Economics & HECER, P.O. Box 479, FI-00101 Helsinki, Finland;3. SITE, Stockholm School of Economics, Box 6501, S-113 83 Stockholm, Sweden |
| |
| Abstract: | This paper develops a model of bargaining over decision rights between an uninformed principal and an informed but self-interested agent. We introduce two different bargaining mechanisms: tacit and explicit bargaining. In tacit bargaining, an uninformed principal makes a take-it-or-leave-it price offer to the agent, who then decides whether to accept or reject the offer. In the equilibrium of the game, the principal inefficiently screens out some agent types so that the agent's private information cannot be fully utilized when the decision is made. In explicit bargaining in which parties can communicate explicitly via cheap talk before tacit bargaining, however, an equilibrium with no such inefficient screening exists even when the conflict of interest is arbitrarily large. We also follow a mechanism design approach, showing that under certain conditions, explicit bargaining is an optimal bargaining mechanism that maximizes the joint surplus of the parties. |
| |
| Keywords: | Decision rights Delegation Monetary transfer Cheap talk |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
