Bargaining and Value

Sergiu Hart and Andreu Mas-Colell

(Acrobat PDF files)

(*) Correction to the Proof of Proposition 8

We present and analyze a model of non-cooperative bargaining among n participants, applied to situations describable as games in coalitional form. This leads to a unified solution theory for such games that has as special cases the Shapley value in the transferable utility (TU) case, the Nash bargaining solution in the pure bargaining case, and the recently introduced Maschler--Owen consistent value in the general non-transferable utility (NTU) case. Moreover, we show that any variation (in a certain class) of our bargaining procedure which generates the Shapley value in the TU setup must yield the consistent value in the general NTU setup.

Keywords: n-person bargaining, coalitional games, non-cooperative implementation, Shapley value, NTU-value, consistent value