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Social Sciences Brown Bag Seminar

Monday, May 19, 2014
12:00pm to 1:00pm
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Baxter B125
Decentralized Bargaining: Efficiency and the Core
Matthew Elliott, Assistant Professor of Economics, Caltech,

The paper presents a model of decentralized bargaining between many buyers and many sellers. The model is non-cooperative, fully decentralized, and in Markov strategies. The main result identifies a necessary and sufficient condition for equilibrium efficiency. This condition is closely related to the Core of the economy, thereby connecting non-cooperative bargaining outcomes to the cooperative approach. Bargaining positions evolve endogenously in the game and can lead to both mismatch and delay. Mismatch is necessary for equilibrium delay.

For more information, please contact Gloria Bain by phone at Ext. 4089 or by email at gbain@hss.caltech.edu.