Efficient Sequential Bargaining
Lawrence M. Ausubel and Raymond Deneckere ,
2
( 60 )
Review of Economic Studies
435-461
April
1993
Abstract

Suppose that a seller and a buyer have private valuations for a good, and that their respective utilities from a trading mechanism are given by usand ub. (These utilities are determined by the valuation for the good, by whether a trade occurs, and by the price which is paid.) Consider the problem of maximizing E[λus + (1 − λ)ub] for some weight λ in the unit interval.

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