Entreprises behavior in cooperative and punishment‘s repeated negotiations

Roman, Mihai Daniel (2008): Entreprises behavior in cooperative and punishment‘s repeated negotiations. Published in: Journal of Applied Quantitative Methods No. 1/2009 (30 January 2009): pp. 1-16.

Abstract

Our paper considers a “negotiation game” between two players which combines the features of two-players alternating offers bargaining and repeated games. Generally, the negotiation game in general admits a large number of equilibriums but some of which involve delay and inefficiency. Thus, complexity and bargaining in tandem may offer an explanation for cooperation and efficiency in repeated games. The Folk Theorem of repeated games is a very used result that shows if players are enough patience then it is possible to obtain a cooperative equilibrium of the infinite repeated game. We proof a new folk theorem for finitely repeated games and also we find new conditions (under stage number and minimum discount factor value) such that players cooperate at least one period in cooperative-punishment repeated games. Finally we present a study-case for Cournot oligopoly situation for n enterprises behavior under finitely and infinitely repeated negotiations. We found for this situation discount factor depends only on players number, not on different player’s payoffs.

• Item Type: MPRA Paper
• Language: English
• Keywords: Negotiation Game, Repeated Game, Bargaining, Folk theorem, Bounded Rationality, Cournot oligopoly
• Subjects: C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C78 - Bargaining Theory ; Matching Theory; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L13 - Oligopoly and Other Imperfect Markets; D - Microeconomics > D4 - Market Structure, Pricing, and Design > D43 - Oligopoly and Other Forms of Market Imperfection; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games ; Evolutionary Games ; Repeated Games

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