Bargaining in dynamic markets

Steady states in matching and bargaining

“…A general version of the modelwith possibly non-stationary market dynamics but exogenous costless entry-is formalized in Manea (2013). The reader is referred to that paper for a discussion of measurability issues and game theoretic solution concepts.…”

“…In a companion paper (Manea 2013), we study market dynamics in a version of the bargaining game considered here with exogenous non-stationary inflows. One result in that paper shows that if players engage in meetings with exogenous and possibly non-stationary frequencies over time, then the game can be solved using iterated conditional dominance.…”

“…Accordingly, Lauermann and Noldeke define a correspondence on the domain of complete profiles of steady state variables, including payoffs and unmatched distributions, whose fixed points capture all steady state conditions explicitly. 8 We finally comment on the technical challenges involved in extending our methods to settings with a continuum of types i ∈ [0, 1] and a continuous steady state density µ of unmatched players. As explained above, Shimer and Smith show that in such settings the assumption of a strictly super-or sub-modular production function f implies that the matching probabilities α ij must be either 0 or 1 for almost all pairs of types (i, j).…”

Exchange Networks with Stochastic Matching

“…Whereas the case of bargaining between two players-even in stochastic processes ( [16,17])-is now well understood, the possible outcomes of bargaining on a large scale such as networked systems has been less explored. Those represent patterns of trading opportunities ( [18,19]), which are not necessarily stable in time. The examples of networked structures can be found in markets for labor, agricultural and forestry activities, knowledge and information, housing, energy and in joint-venture partnering.…”

“…More importantly, the number of research papers specifically exploring the strategic issues that appear in bargaining on networks with random matching are relatively infrequent to date. Among others, the topic has been previously discussed by [18,19,30,31]. In their models, the matching mechanism activates a number of linked pairs of agents.…”