Publisher
UNIV CHICAGO PRESSCitation
Allan Collard-Wexler, Gautam Gowrisankaran, and Robin S. Lee, "“Nash-in-Nash” Bargaining: A Microfoundation for Applied Work," Journal of Political Economy 127, no. 1 (February 2019): 163-195. https://doi.org/10.1086/700729Journal
JOURNAL OF POLITICAL ECONOMYRights
© 2019 by The University of Chicago. All rights reserved.Collection Information
This item from the UA Faculty Publications collection is made available by the University of Arizona with support from the University of Arizona Libraries. If you have questions, please contact us at repository@u.library.arizona.edu.Abstract
A "Nash equilibrium in Nash bargains" has become a workhorse bargaining model in applied analyses of bilateral oligopoly. This paper proposes a noncooperative foundation for "Nash-in-Nash" bargaining that extends Rubinstein's alternating offers model to multiple upstream and downstream firms. We provide conditions on firms' marginal contributions under which there exists, for sufficiently short time between offers, an equilibrium with agreement among all firms at prices arbitrarily close to Nash-in-Nash prices, that is, each pair's Nash bargaining solution given agreement by all other pairs. Conditioning on equilibria without delayed agreement, limiting prices are unique. Unconditionally, they are unique under stronger assumptions.Note
12 month embargo; published online: 4 January 2019ISSN
0022-38081537-534X
DOI
10.3386/w20641Version
Final published versionSponsors
National Science Foundation [SES-1425063]ae974a485f413a2113503eed53cd6c53
10.3386/w20641