A Noncooperative Model of Collective Decision

GATT Research Papers
CARD Reports and Working Papers
1-1992
A Noncooperative Model of Collective Decision
Making: Multi-Lateral Bargaining Approach
Gordon C. Rausser
University of California - Berkeley
Leo K. Simon
University of California - Berkeley
Follow this and additional works at: http://lib.dr.iastate.edu/gatt_papers
Part of the Agricultural and Resource Economics Commons, Agriculture Commons, and the
Statistical Models Commons
Recommended Citation
Rausser, Gordon C. and Simon, Leo K., "A Noncooperative Model of Collective Decision Making: Multi-Lateral Bargaining
Approach" (1992). GATT Research Papers. 69.
http://lib.dr.iastate.edu/gatt_papers/69
This Article is brought to you for free and open access by the CARD Reports and Working Papers at Iowa State University Digital Repository. It has
been accepted for inclusion in GATT Research Papers by an authorized administrator of Iowa State University Digital Repository. For more
information, please contact digirep@iastate.edu.
A Noncooperative Model of Collective Decision Making: Multi-Lateral
Bargaining Approach
Abstract
This paper proposes a noncooperative model of multilateral bargaining. The model can be viewed as an
extension of the famous Stahl-Rubinstein bargaining game. Two players take turns proposing a division of a
"pie." After one player has proposed a division, the other can accept or reject the proposal. If the proposal is
accepted, the game ends and the division is adopted; if it is rejected, the second player then makes a proposal,
which the first player then accepts or rejects. And so on. In Stahl's formulation, the game continues for a finite
number of rounds; in Rubinstein's extension, the number of rounds is infinite. We propose a generalization of
this model to incorporate multiple players and multidimensional issue spaces. We consider a sequence of
games with infinite bargaining horizons, and study the limit points of the equilibrium outcomes as the horizon
is extended without bound. A novel feature of our model is that the proposer is chosen randomly "by nature"
in each round or bargaining, according to a prespecified vector of strictly positive "access probabilities."
Keywords
Agriculture, Models and assessment tools, Multilateral bargaining
Disciplines
Agricultural and Resource Economics | Agriculture | Statistical Models
This article is available at Iowa State University Digital Repository: http://lib.dr.iastate.edu/gatt_papers/69