A UNIQUE SOLUTION TO N-PERSON SEQUENTIAL BARGAINING

Rubinstein's two-person sequential bargaining model yields a unique subgame-perfect equilibrium; this uniqueness result does not hold with three or more persons. Based on Greenberg's theory of social situations uniqueness is here offered as follows: Assume a player can profitably reject a suggested path (at one of his decision nodes) by suggesting a new one to later players, if by doing so he gains more than ε. A path is acceptable of and only if no player can profitably reject it by suggesting another acceptable path. It is shown that only the "stationary" division is acceptable for any ε > 0. © 1992.