2014•arXiv (Cornell University)Open access

A Solution to Bargaining Problem on Divisible Goods

Xuegong Deng

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Abstract

Two-person bargaining problem is considered as to allocate a number of goods between two players. This paper suggests that any non-trivial division of goods cause a non-zero change on the solution of bargaining. So, a axiom of sharing division is presented, as an alternative axiom to Nash axiom of independence of irrelevant alternatives and Kalai-Smorodinsky axiom of monotonicity. This solution is targeted at the partialities of Nash and Kalai-Smorodinsky solution on some specific issues, but not to say it is better than others.

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Two-person bargaining problem is considered as to allocate a number of goods between two players. This paper suggests that any non-trivial division of goods cause a non-zero change on the solution of bargaining. So, a axiom of sharing division is presented, as an alternative axiom to Nash axiom of independence of irrelevant alternatives and Kalai-Smorodinsky axiom of monotonicity. This solution is targeted at the partialities of Nash and Kalai-Smorodinsky solution on some specific issues, but not to say it is better than others.

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Available abstract

Two-person bargaining problem is considered as to allocate a number of goods between two players. This paper suggests that any non-trivial division of goods cause a non-zero change on the solution of bargaining. So, a axiom of sharing division is presented, as an alternative axiom to Nash axiom of independence of irrelevant alternatives and Kalai-Smorodinsky axiom of monotonicity. This solution is targeted at the partialities of Nash and Kalai-Smorodinsky solution on some specific issues, but not to say it is better than others.

Key concepts: Independence of irrelevant alternatives, Axiom, Bargaining problem, Mathematical economics, Axiom independence, Monotonic function, Division (mathematics), Independence (probability theory)

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