Nash meets Rubinstein in final-offer arbitration
نویسندگان
چکیده
منابع مشابه
Alternating-offer games with final-offer arbitration
I analyze an alternating-offer model that integrates the common practice of having an arbitrator determine the outcomes if both players’ offers are rejected. I assume that the arbitrator uses final-offer arbitration (as in professional baseball). I find that if the arbitrator does not excessively favor one player, then the unique subgame-perfect equilibrium always coincides with the subgame-per...
متن کاملFinal-Offer Arbitration and Risk Aversion in Bargaining
N are often conducted under the stipulation that an impasse is to be resolved using final-offer arbitration (FOA). In fact, FOA frequently is not needed; in Major League Baseball, for instance, more than 80% of the salary negotiations that could go to arbitration instead reach a bargained agreement. We show that the risk aversion of at least one side explains this phenomenon. We then model pay ...
متن کاملAn Analysis and Evaluation of Final Offer Arbitration
Final offer arbitration (FOA) and conventional arbitration (ARE) are compared as mechanisms for settling labor disputes. It is recognized that the parties can manipulate their final offers under FOA in order to achieve a more desirable outcome, and the equilibrium pair of final offers is derived as a function of the uncertainty about the arbitrator's award and the relative risk preferences of t...
متن کاملAmended Final-Offer Arbitration is Improved Arbitration: Evidence from the Laboratory*
Arbitration is frequently utilized to settle disputes. Much research has focused on the properties of final-offer arbitration (FOA) relative to conventional arbitration. Both mechanisms should encourage settlement in standard environments, but previous empirical work finds that impasses remain common. A modification of FOA, amended final-offer arbitration (AFOA), has been proposed as an alterna...
متن کاملStrategic Bidding and Investments in Final Offer Arbitration: Theory and Experimental Evidence
Given the sizeable savings, many disputes are resolved via arbitration. Numerous studies have considered the strategic incentives of various forms of arbitration, most notably Final Offer Arbitration (FOA). While previous work focused exclusively on optimal offers, in reality disputants make a series of perhaps interrelated choices. This paper considers FOA disputants making an additional inves...
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ژورنال
عنوان ژورنال: Economics Letters
سال: 2011
ISSN: 0165-1765
DOI: 10.1016/j.econlet.2010.10.020