Annals of Operations Research

, Volume 251, Issue 1–2, pp 285–299 | Cite as

The conservative Kalai–Smorodinsky solution for multiple scenario bargaining

Article
  • 105 Downloads

Abstract

In this paper we address two-person bargaining problems under uncertainty where several states of nature or future scenarios are considered. We propose a solution concept based on the distance to a utopia minimum outcome vector, which guarantees conservative levels of achievement for the agents. We also provide an axiomatic characterization for a significant class of these bargaining problems. An extension of the classic model of firm-union negotiation, which includes situations where uncertainty about the consequences of the agreements have to be taken into account, is analyzed in this framework.

Keywords

Bargaining Solutions Uncertainty Risk-aversion Union-firm negotiations 

References

  1. Alexander, C. O., & Ledermann, W. (1996). Are Nash bargaining wage agreements unique? An investigation into bargaining sets for firm-union negotiations. Oxford Economic Papers, 48(2), 242–253.CrossRefGoogle Scholar
  2. Bell, L. A. (1995). Union wage concessions in the 1980s: The importance of firm-specific factors. Industrial and Labor Relations Review, 48(2), 258–275.CrossRefGoogle Scholar
  3. Bossert, W., Nosal, E., & Sadanand, V. (1996). Bargaining under uncertainty and the monotone path solutions. Games and Economics Behavior, 14(2), 173–189.CrossRefGoogle Scholar
  4. Bossert, W., & Peters, H. (2001). Minimax regret and efficient bargaining under uncertainty. Games and Economics Behavior, 34(1), 1–10.CrossRefGoogle Scholar
  5. de Clippel, G. (2007). An axiomatization of the Nash bargaining solution. Social Choice and Welfare, 29, 201–210.CrossRefGoogle Scholar
  6. Dickinson, D. L. (2009). The effects of beliefs versus risk attitude on bargaining outcomes. Theory and Decision, 66, 69–101.CrossRefGoogle Scholar
  7. Dickinson, D. L., & Hunnicutt, L. (2010). Nonbinding recommendations: The relative effects of focal points versus uncertainty reduction on bargaining outcomes. Theory and Decision, 69, 615–634.CrossRefGoogle Scholar
  8. Gerber, A., & Upmann, T. (2006). Bargaining solutions at work: Qualitative differences in policy implications. Mathematical Social Sciences, 52, 162–175.CrossRefGoogle Scholar
  9. Gupta, S. (1989). Modeling integrative, multiple issue bargaining. Management Science, 35, 788–806.CrossRefGoogle Scholar
  10. Hinojosa, M. A., Mármol, A. M., & Monroy, L. (2005). Generalized maximin solutions in multicriteria bargaining. Annals of Operations Research, 137, 243–255.CrossRefGoogle Scholar
  11. Hirsch, B., & Schnabel, C. (2013). What can we learn from bargaining models about union power? The decline in union power in Germany, 1992–2009. The Manchester School, 82(3), 347–362. doi:10.1111/manc.12028.CrossRefGoogle Scholar
  12. Kalai, E., & Smorodinsky, M. (1975). Other solutions to Nash’s bargaining problem. Econometrica, 43(3), 513–518.CrossRefGoogle Scholar
  13. Kalai, E. (1977). Proportional solutions to bargaining situations: Interpersonal utility comparisons. Econometrica, 45(3), 1623–1630.CrossRefGoogle Scholar
  14. Magoc, T., & Krinovich, V. (2009). A new simplified derivation of Nash bargaining solution. Applied Mathematical Sciences, 22, 1097–1101.Google Scholar
  15. Mármol, A. M., & Ponsatí, C. (2008). Bargaining over multiple issues with maximin and leximin preferences. Social Choice and Welfare, 30(2), 211–223.CrossRefGoogle Scholar
  16. Mármol, A. M., Monroy, L., & Rubiales, V. (2007). An equitable solution for multicriteria bargaining games. European Journal of Operational Research, 177(3), 1523–1534.CrossRefGoogle Scholar
  17. McDonald, I. M., & Solow, R. M. (1981). Wage bargaining and employment. The American Economic Review, 71(5), 896–908.Google Scholar
  18. Nash, J. F. (1950). The bargaining problem. Econometrica, 18(2), 155–162.CrossRefGoogle Scholar
  19. Peters, H. (1986). Simultaneity of issues and additivity in bargaining. Econometrica, 54, 153–169.CrossRefGoogle Scholar
  20. Rong, K. (2012). An axiomatic approach to arbitration and its application in bargaining games. The B.E. Journal of Theoretical Economics, 12. doi:10.1515/1935-1704.1849.
  21. Riddell, W. C. (1981). Bargaining under uncertainty. American Economic Review, 71(4), 579–590.Google Scholar
  22. Roemer, J. E. (1988). Axiomatic bargaining theory on economic environments. Journal of Economic Theory, 45, 1–31.CrossRefGoogle Scholar
  23. Sessions, J. G. (2008). Wages, supervision and sharing. The Quarterly Review of Economics and Finance, 48(4), 653–672.CrossRefGoogle Scholar
  24. Vlassis, M. (2003). Wage centralization and the scope of firm-union bargaining:“Efficient bargains” or “labour demand”? The Manchester School, 71(3), 308–329.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  1. 1.Departamento de Economía Aplicada III. Facultad de Ciencias Económicas y EmpresarialesUniversidad de SevillaSevillaSpain

Personalised recommendations