Search theory, competitive equilibrium, and the Nash bargaining solution

A-Tier
Journal: Journal of Economic Theory
Year: 2013
Volume: 148
Issue: 4
Pages: 1659-1688

Authors (2)

Cho, In-Koo (Emory University) Matsui, Akihiko (not in RePEc)

Score contribution per author:

2.018 = (α=2.02 / 2 authors) × 2.0x A-tier

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

Abstract

We investigate a canonical search-theoretic model without entry. Two agents are randomly matched with a long side being rationed. The matched agents face a pair of randomly drawn non-transferable payoffs, and then choose whether or not to form a partnership subject to a small probability of exogenous break down. As this probability and friction vanish, the Nash bargaining solution emerges as the unique undominated strategy equilibrium outcome if the mass of each party is the same. If the size of one party is larger than the other, the short side extracts the entire surplus, a sharp contrast to Rubinstein and Wolinsky (1985) [16].

Technical Details

RePEc Handle
repec:eee:jetheo:v:148:y:2013:i:4:p:1659-1688
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25