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  3. American Economic Journal: Microeconomics
  4. February 2022
  5. Negotiations with Limited Specifiability

American Economic Journal:
Microeconomics

ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)

Negotiations with Limited Specifiability

  • Satoshi Fukuda
  • Yuichiro Kamada
American Economic Journal: Microeconomics
vol. 14, no. 1, February 2022
(pp. 216–44)
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Abstract

We study negotiations with limited specifiability⁠—each party may not be able to fully specify a negotiation outcome. We construct a class of negotiation protocols to conduct comparative statics on specifiability as well as move structures. We find that asynchronicity of proposal announcements narrows down the equilibrium pay-off set, in particular, leading to a unique prediction in negotiations with a "common interest" alternative. The equilibrium payoff set is not a singleton in general, and depends on the fine details of how limitation on specifiability is imposed. The equilibrium payoff set is weakly larger under limited specifiability than under unlimited specifiability.

Citation

Fukuda, Satoshi, and Yuichiro Kamada. 2022. "Negotiations with Limited Specifiability." American Economic Journal: Microeconomics, 14 (1): 216–44. DOI: 10.1257/mic.20190089

Additional Materials

JEL Classification

  • C72 Noncooperative Games
  • D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
  • D86 Economics of Contract: Theory
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