We study a framework where two duopolists compete repeatedly in prices and where cho-sen prices potentially affect future market shares, but certainly do not affect current sales.This assumption of consumer inertia causes (noncooperative) coordination on high pricesonly to be possible as an...

We study a framework where two duopolists compete repeatedly in prices and where chosen prices potentially affect future market shares, but certainly do not affect current sales. This assumption of consumer inertia causes (noncooperative) coordination on high prices only to be possible as an...

In this paper a selection theory for stochastic games is developed. The theory itself is based on the ideas of Harsanyi and Selton to select equilibria for games in standard form. We introduce several possible definitions for the stochastic tracing procedure, an extension of the linear tracing...

Under a k-approval scoring rule each agent attaches a score of one to his k most preferred alternatives and zero to the other alternatives. The rule assigns the set of alternatives with maximal score. Agents may extend preferences to sets in several ways: they may compare the worst alternatives,...

We introduce trustworthy traders in bilateral trading. Trustworthy traders do not misrepresent their private information. We prove that an increase in the levels of trust (probabilities that traders are trustworthy) can reduce the maximum attainable probability of trade among the strategic...

Coordination failures constitute an alternative explanation for underemployment that complements the Keynesian and neo-classical views. The paper proposes to distinguish three classes of models with coordination failures. The classes are formed by strategic models with or without a coordinating...

Dynamic TU-games are considered which consist of a finite player set, a finite sequence of TU-games and a profile of intertemporal utility functions. At every stage a (restrictively) additive solution is applied to the TU-game, which results in a stream of payoff distributions, evaluated by the...

Suppose that a firm has several owners and that the future is uncertain in the sense that one out of many different states of nature will realize tomorrow. An owner''s time preference and risk attitude will determine the importance he places on payoffs in the different states. It is a...

We propose a new model to study the role of commitment as a sourceof strategic bargaining power. Two impatient players bargain aboutthe division of a pie under a standard bargaining protocol indiscrete time with time-invariant recognition probabilities.Instantaneous utility is linear, but...

Previous theoretical literature proved the existence of an upper bound on efficiency in bilateral bargaining. In contrast, experiments consistently find players obtaining higher efficiency than the upper bound if they are allowed to communicate before the 1/2-double auction. We bridge this gap...