A Nash Demand Game Experiment in Multiple Dimensions

Mercredi | 2021-11-18
B103 – 12h00

Jentry JONES

Is it easier or harder to bargain in a multidimensional bargaining setting? Though multidimensional bargaining settings are common, different literatures have different answers. Individuals’ interests are not necessarily diametrically opposed in multiple dimensions, but multiple dimensions are conceptually more challenging and may unintentionally lead to an increased dependence on heuristics. This experiment uses an induced value, bidimensional Nash Demand Game to investigate how a multidimensional framing of the bargaining setting can affect agreements. The results demonstrate that factors such as whether individuals share a preference for one of the two dimensions and whether individuals’ respective disagreement points are identical in both dimensions can have important consequences for whether an agreement is reached, and if so, how efficiently this agreement divides the total surplus available. This experiment illuminates that bargaining in multiple dimensions can be easier or harder, depending on the specifics of the bargaining setting.