The Nash bargaining solution is optimal
type: Item
instance of: scholarly article
title: The Nash bargaining solution is optimal
zbMATH Open document ID: 0647.90106
DOI: 10.1016/0022-0531(86)90089-X
published in: Journal of Economic Theory
publication date: 1986-01-01T00:00:00Z
review text: The author studies the classical two-person bargaining game. The set F consists of all bargaining solutions that satisfy the following known axioms: Pareto optimality, scale invariance, symmetry and risk sensitivity. It is proved that for any bargaining game S the set \(\{\) f(S): \(f\in S\}\) is closed and connected. A meta bargaining game \(\Gamma\) (S) is defined, where \(S_ 1=S\) and the set \(S_{t+1}\) consists of all those payoff vectors for which the ith coordinate does not exceed the demand of player i in stage t. This game has many interesting properties. It is also proved that only the Nash solution is an equilibrium for every bargaining game S, and that the ``independence of irrelevant alternative'' axiom can be replaced by a much weaker recursivity axiom.
Mathematics Subject Classification ID: 91A12
zbMATH DE Number: 4057329
zbMATH Keywords: two-person bargaining
zbMATH Keywords: Pareto optimality
zbMATH Keywords: scale invariance
zbMATH Keywords: symmetry
zbMATH Keywords: risk sensitivity
zbMATH Keywords: meta bargaining game
zbMATH Keywords: Nash solution
author: Eric van Damme
MaRDI profile type: Publication
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full work available at URL: 0022-0531(86)90089-x
OpenAlex ID: W2158695801
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description: scientific article; zbMATH DE number 4057329