The separability principle in bargaining

We investigate the implications of the separability principle in the context of bargaining. For two bargaining problems with the same population, suppose that there is a subgroup of agents who receive the same payoffs in both bargaining problems. Moreover, if we imagine the departure of this subgroup with their payoffs, then the remaining agents face the same opportunities in both bargaining problems. The separability principle requires that under these hypotheses, the remaining agents should receive the same payoffs in both bargaining problems. We begin with investigating the logical relations between separability and two other axioms, contraction independence and consistency. Then, we establish characterizations of the Nash and egalitarian solutions on the basis of separability. Copyright Springer-Verlag Berlin/Heidelberg 2005