Effect of reduced opportunities on bargaining outcomes: an experiment with status asymmetries
- PDF / 886,008 Bytes
- 34 Pages / 439.37 x 666.142 pts Page_size
- 1 Downloads / 169 Views
(0123456789().,-volV)(0123456789().,-volV)
Effect of reduced opportunities on bargaining outcomes: an experiment with status asymmetries Subrato Banerjee1,2 Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract Several allocation rules (such as the Kalai–Smorodinsky solution) allow for possible violations of the ‘independence of irrelevant alternatives’ (IIA) axiom in cooperative bargaining game theory. Nonetheless, there is no conclusive evidence on how contractions of feasible sets exactly affect bargaining outcomes. We have been able to identify a definite behavioral channel through which such contractions actually determine the outcomes of negotiated bargaining. We find that the direction and the extent of changes in bargaining outcomes, due to contraction of the feasible set, respond to the level of (given) agent asymmetry with a remarkable degree of regularity. Alongside, we conclude that the validity of the IIA axiom is only limited to symmetric games. Keywords Experimental bargaining Agent asymmetry Contraction axiom For all the support, valuable inputs and feedback, I thank John List, Arunava Sen, Ariel Rubinstein, Lata Gangadharan, Keith Ericson, Bharat Ramaswami, Debasis Mishra, Dilip Mookherjee, Seema Jayachandran,
Abhiroop Mukhopadhyay, Jacques-Franc¸ois Thisse, Margaret Slade, Marilda Sotomayor, Eswaran Somanathan, Pene´lope Herna´ndez, Prabal Roy Chowdhury, Lionel Page, Martin Cripps, Joe¨l van der Weele, Uwe Dulleck, and Gigi Foster. I also thank Anjan Mukherji, Botond K} oszegi and Alan Sorensen for their interest and encouragement. I am grateful to the Planning and Policy Research Unit (PPRU) for the generous grant to support this research; and acknowledge the efforts of our programmer Dushyant Rai for the use of z-Tree software for a part of the experiment. Our coordinator Priyanka Kothari, and all the z-Tree webgroup members went out of their way to help us whenever needed. This research has also benefited from the
comments received at the UECE Meetings in Game Theory and Applications, Lisbon (Instituto Superior Economia e Gesta˜o, 2013); the Annual Conference on Economic Growth and Development, New Delhi (Indian Statistical Institute, 2013); the IGC-ISI Summer School in Development Economics, New Delhi (Indian Statistical Institute, 2014); the Latin American Meeting of the Econometric Society, Sa˜o Paulo (University of Sa˜o Paulo, 2014); the Australasian Development Economics Workshop (University of New South Wales, 2017); the Royal Economic Society Annual Conference (University of Sussex, 2018). Finally, I extend my sincerest gratitude to two anonymous referees who have given my paper its final shape. This paper was previously titled ’Set contractions and bargaining outcomes: An experiment’.
& Subrato Banerjee [email protected] 1
Queensland University of Technology Business School (Centre for Behavioural Economics, Society and Technology), Brisbane, QLD, Australia
2
University of Melbourne (Australia India Institute), Melbourne, VIC, Australia
Data Loading...
