On the influence of hard leverage in a soft leverage bargaining game: The importance of credible claims

What makes a bargaining proposal credible? We study how hard leverage (binding commitment) influences soft leverage (appealing to a focal point) in a rich-context bargaining game known to exhibit competing claims to focality. In three treatments, our experiment varies one bargainer's ability to commit, holding the soft leverage condition fixed. As in previous studies, we observe that opening offers are consistent with the available soft leverage. The influence of hard leverage is most evident in the concessionary stage. Hard and soft leverage interact to influence outcomes: Hard leverage advantages its holder, yet settlements largely stay between the two focal points. We posit that focal points induce mutual expectations of bargainer social preferences that, when combined with the Nash bargaining solution, imply the comparative statics concerning the settlements observed. A similarly modified version of the Zeuthen–Harsanyi model of the bargaining process, agrees with the comparative statics on opening offers and concessions. © 2016 Elsevier Inc

Duality, area-considerations, and the Kalai–Smorodinsky solution

We introduce a new solution concept for 2-person bargaining problems, which can be considered as the dual of the Equal-Area solution (EA) (see Anbarcı and Bigelow (1994)). Hence, we call it the Dual Equal-Area solution (DEA). We show that the point selected by the Kalai–Smorodinsky solution (see Kalai and Smorodinsky (1975)) lies in between those that are selected by EA and DEA. We formulate an axiom–area-based fairness–and offer three characterizations of the Kalai–Smorodinsky solution in which this axiom plays a central role. © 2016 Elsevier B.V

The Role of Goals and Feedback in Incentivizing Performance

In this paper, we experimentally investigate how goal setting and feedback policies affect work performance. In particular, we study the effects of (i) absolute performance feedback, (ii) self-specified goals, and (iii) exogenous goals and relative performance feedback. Our results show that the average performance of the subjects who are provided self-performance feedback is 11% lower than the ones who obtain no feedback. Moreover, setting a non-binding personal goal does not affect performance. Finally, assigning an exogenous goal and providing relative performance feedback decreases performance by 8%. We discuss the insights our findings offer for the optimal design of goal setting and feedback mechanisms. Copyright © 2015 John Wiley & Sons, Ltd. Copyright © 2015 John Wiley & Sons, Ltd

A bargaining procedure leading to the serial rule in games with veto players

This paper studies an allocation procedure for coalitional games with veto players. The procedure is similar to the one presented by Arin and Feltkamp (J Math Econ 43:855-870, 2007), which is based on Dagan et al. (Games Econ Behav 18:55-72, 1997). A distinguished player makes a proposal that the remaining players must accept or reject, and conflict is solved bilaterally between the rejector and the proposer. We allow the proposer to make sequential proposals over several periods. If responders are myopic maximizers (i.e. consider each period in isolation), the only equilibrium outcome is the serial rule of Arin and Feltkamp (Eur J Oper Res 216:208-213, 2012) regardless of the order of moves. If all players are fully rational, the serial rule still arises as the unique subgame perfect equilibrium outcome if the order of moves is such that stronger players respond to the proposal after weaker ones

The Effect of Stake Size in Experimental Bargaining and Distribution Games: A Survey

We review the literature on bargaining and distribution experiments to investigate whether changes in stake size have significant effects on behaviour in laboratory/field settings. We conclude that experiments in this field do not lead to clear/common results. The joint presence of opposing factors (e.g., increasing relative risk aversion and increasing cost of fairness) might be one reason contributing to this. Moreover, we argue that variables such as subjects’ financial conditions, cognitive abilities, risk attitudes, loss-aversion, justice orientations, and relevant personality characteristics should be controlled in laboratory experiments to understand the effect of stake size on behaviour, more clearly. Finally, quasi-experiments using data from (very) high-stake games/events and meta-analysis studies should complement (individual) controlled experiments. � 2016, Springer Science+Business Media Dordrecht