Bargaining and network structure: An experiment

Gary Charness; Margarida Corominas-Bosch; Guillaume R. Fréchette

doi:10.1016/j.jet.2005.06.009

Bargaining and network structure: An experiment

Gary Charness, Margarida Corominas-Bosch, Guillaume R. Fréchette

Research output: Contribution to journal › Article › peer-review

Abstract

We consider bargaining in a bipartite network of buyers and sellers, who can only trade with the limited number of people with whom they are connected. We perform an experimental test of a graph-theoretic model that yields unique predictions about equilibrium prices for the networks in our sessions. The results diverge sharply depending on how a connection is made between two separate simple networks, typically conforming to the theoretical directional predictions. Payoffs can be systematically affected even for agents who are not connected by the new link, and we find evidence of a form of social learning.

Original language	English (US)
Pages (from-to)	28-65
Number of pages	38
Journal	Journal of Economic Theory
Volume	136
Issue number	1
DOIs	https://doi.org/10.1016/j.jet.2005.06.009
State	Published - Sep 2007

Keywords

Bargaining
Experiment
Graph theory
Network
Social learning

ASJC Scopus subject areas

Economics and Econometrics

Access to Document

10.1016/j.jet.2005.06.009

Cite this

@article{9a390450a15d4b9a9f82b098a0d9e540,

title = "Bargaining and network structure: An experiment",

abstract = "We consider bargaining in a bipartite network of buyers and sellers, who can only trade with the limited number of people with whom they are connected. We perform an experimental test of a graph-theoretic model that yields unique predictions about equilibrium prices for the networks in our sessions. The results diverge sharply depending on how a connection is made between two separate simple networks, typically conforming to the theoretical directional predictions. Payoffs can be systematically affected even for agents who are not connected by the new link, and we find evidence of a form of social learning.",

keywords = "Bargaining, Experiment, Graph theory, Network, Social learning",

author = "Gary Charness and Margarida Corominas-Bosch and Fr{\'e}chette, {Guillaume R.}",

note = "Funding Information: We are grateful for experimental funding from Spain{\textquoteright}s Ministry of Education under Grants PB98-1076 and DI000216. Charness also gratefully acknowledges support from the MacArthur Foundation. This research was undertaken while Charness was affiliated with Universitat Pompeu Fabra. Fr{\'e}chette{\textquoteright}s research was partially supported by the Center for Experimental Social Science and the C.V. Starr Center.",

year = "2007",

month = sep,

doi = "10.1016/j.jet.2005.06.009",

language = "English (US)",

volume = "136",

pages = "28--65",

journal = "Journal of Economic Theory",

issn = "0022-0531",

publisher = "Academic Press Inc.",

number = "1",

}

TY - JOUR

T1 - Bargaining and network structure

T2 - An experiment

AU - Charness, Gary

AU - Corominas-Bosch, Margarida

AU - Fréchette, Guillaume R.

N1 - Funding Information: We are grateful for experimental funding from Spain’s Ministry of Education under Grants PB98-1076 and DI000216. Charness also gratefully acknowledges support from the MacArthur Foundation. This research was undertaken while Charness was affiliated with Universitat Pompeu Fabra. Fréchette’s research was partially supported by the Center for Experimental Social Science and the C.V. Starr Center.

PY - 2007/9

Y1 - 2007/9

N2 - We consider bargaining in a bipartite network of buyers and sellers, who can only trade with the limited number of people with whom they are connected. We perform an experimental test of a graph-theoretic model that yields unique predictions about equilibrium prices for the networks in our sessions. The results diverge sharply depending on how a connection is made between two separate simple networks, typically conforming to the theoretical directional predictions. Payoffs can be systematically affected even for agents who are not connected by the new link, and we find evidence of a form of social learning.

AB - We consider bargaining in a bipartite network of buyers and sellers, who can only trade with the limited number of people with whom they are connected. We perform an experimental test of a graph-theoretic model that yields unique predictions about equilibrium prices for the networks in our sessions. The results diverge sharply depending on how a connection is made between two separate simple networks, typically conforming to the theoretical directional predictions. Payoffs can be systematically affected even for agents who are not connected by the new link, and we find evidence of a form of social learning.

KW - Bargaining

KW - Experiment

KW - Graph theory

KW - Network

KW - Social learning

UR - http://www.scopus.com/inward/record.url?scp=34548045744&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=34548045744&partnerID=8YFLogxK

U2 - 10.1016/j.jet.2005.06.009

DO - 10.1016/j.jet.2005.06.009

M3 - Article

AN - SCOPUS:34548045744

SN - 0022-0531

VL - 136

SP - 28

EP - 65

JO - Journal of Economic Theory

JF - Journal of Economic Theory

IS - 1

ER -

Bargaining and network structure: An experiment

Abstract

Keywords

ASJC Scopus subject areas

Access to Document

Other files and links

Fingerprint

Cite this