The presence of obstinate types in bargaining has been shown to alter dramatically the bargaining equilibrium strategies and outcomes. This paper shows that outside options may cancel out the effect of obstinacy in bargaining. When parties have access to stationary outside options, we show that...

The coalitional Nash bargaining solution is defined to be the core allocation for which the product of players' payoffs is maximal. We consider a non-cooperative model with discounting in which one team may form and every player is randomly selected to make a proposal in every period. The grand...

This paper examines repeated games in which each player observes a private and imperfect signal on the actions played and in which players are allowed to communicate using public messages. Providing incentives for players to reveal their observations generate revelation constraints which,...

The sensitivity of Bayesian implementation to agents' beliefs about others suggests the use of more robust notions of implementation such as ex post implementation, which requires that each agent's strategy be optimal for every possible realization of the types of other agents. We show that the...

The authors study the strategic equilibria of a negotiation game where potential buyers are affected by identity-dependent, negative externalities. The unique equilibrium of long, finitely repeated generic games can either display delay--where a transaction can take place only in several stages...

We study efficient, Bayes--Nash incentive compatible mechanisms in a social choice setting that allows for informational and allocative externalities. We show that such mechanisms exist only if a congruence condition relating private and social rates of information substitution is satisfied. If...

It has been emphasized that when contracts are incomplete (e.g., because some relevant variables are not verifiable by outsiders), the possibility of contract negotiation may prevent achieving desirable allocations that could be implemented otherwise. The authors analyze a situation where...

A model of endogenous growth is developed in which growth is driven by vertical innovations that involve creative destruction. Equilibrium is determined by a forward-looking difference equation, according to which the amount of research in any period depends negatively upon the amount expected...

In this lecture, it is argued that Schumpeterian Growth Theory, in which growth is driven by a sequence of quality-improving innovations, can shed light on two important puzzles raised by the recent evolution of wage inequality in developed economies. The first puzzle concerns wage inequality...