Two-person bargaining when the disagreement point is private information

B-Tier
Journal: Games and Economic Behavior
Year: 2025
Volume: 150
Issue: C
Pages: 387-400

Authors (2)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We consider two-person bargaining problems in which (only) the disagreement payoffs are private information and it is common knowledge that disagreement is inefficient. We show that, in the NTU-case, if the Pareto frontier is linear, the players' interim utilities of an ex post efficient mechanism cannot depend on the disagreement payoffs. If the frontier is non-linear, the result continues to hold when the conflict payoffs are independent, or one player has at most two types. In the TU-case, a similar independence result holds for ex post efficient mechanisms that are individually rational, provided the players' budgets satisfy a certain condition. We discuss implications of these results for axiomatic bargaining theory, surplus extraction by an informed principal and egalitarian mechanisms.

Technical Details

RePEc Handle
repec:eee:gamebe:v:150:y:2025:i:c:p:387-400
Journal Field
Theory
Author Count
2
Added to Database
2026-01-29