Sociological versus strategic factors in bargaining

Alvin E. Roth*, Michael W K Malouf, J. Keith Murnighan

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

61 Scopus citations

Abstract

Most game-theoretic models of strategic interaction, indeed most economic models of any sort, specify potential outcomes entirely in terms of the preferences of the agents, as captured in their (possibly cardinal) utility functions. The underlying assumption is that the outcome of such interactions is determined entirely by these preferences, together with the strategic possibilities available to the agents. The purpose of this paper is to challenge the adequacy of this assumption in general, by investigating it in the specific context of two-person bargaining. In particular, we consider whether certain experimental results reported earlier can be accounted for strictly in terms of players' preferences and strategic possibilities, and we report a new experimental study designed to answer this question. The results strongly support the conclusion that sociological factors, unrelated to what we normally consider to be the 'economic' parameters of a game, can decisively influence the outcome of bargaining, in a systematic manner.

Original languageEnglish (US)
Pages (from-to)153-177
Number of pages25
JournalJournal of Economic Behavior and Organization
Volume2
Issue number2
DOIs
StatePublished - Jun 1981

ASJC Scopus subject areas

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management

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