Abstract
Already the early approaches to the bargaining problem were concerned with a formalization of the bargaining process. Harsanyi (1956) gave an interpretation of Zeuthen’s (1930) bargaining theory in the light of game theory. In this interpretation the bargaining process is driven by the concessions of the players, which emerge as repeated improvements of a product of utility differences. A player will make a concession if for his proposal this product is lower than the product resulting from the opponent’s proposal. In case of equality of the utility products Zeuthen assumes that the player will concede. The magnitude of the concession is not specified explicitly. The difficulty of this approach is that the utility functions of the players have to be known. Hence, a test of this theory (see for example Tietz and Weber, 1972) requires to make assumptions on these functions.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
