IDEAS home Printed from https://ideas.repec.org/a/eee/joepsy/v90y2022ics0167487022000320.html
   My bibliography  Save this article

An empirical analysis of insistent bargaining

Author

Listed:
  • Send, Jonas
  • Serena, Marco

Abstract

In alternating-offer bargaining, a seller is “insistent” if she demands the same asking price more than once. We provide empirical evidence on insistence and inform the theoretical literature by analyzing millions of eBay bargaining threads taken from Backus, Blake, Larsen, and Tadelis (2020). Focusing on the best predictors of first-period insistence, we find that insistence is sticky – a seller who was insistent in the past is more likely to be insistent in the future – and a seller is more likely insistent if the buyer has been particularly lenient or tough in her counteroffer.

Suggested Citation

  • Send, Jonas & Serena, Marco, 2022. "An empirical analysis of insistent bargaining," Journal of Economic Psychology, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:joepsy:v:90:y:2022:i:c:s0167487022000320
    DOI: 10.1016/j.joep.2022.102516
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167487022000320
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.joep.2022.102516?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Alexander Wolitzky, 2012. "Reputational Bargaining With Minimal Knowledge of Rationality," Econometrica, Econometric Society, vol. 80(5), pages 2047-2087, September.
    3. Olivier Compte & Philippe Jehiel, 2002. "On the Role of Outside Options in Bargaining with Obstinate Parties," Econometrica, Econometric Society, vol. 70(4), pages 1477-1517, July.
    4. Matthew Backus & Thomas Blake & Steven Tadelis, 2019. "On the Empirical Content of Cheap-Talk Signaling: An Application to Bargaining," Journal of Political Economy, University of Chicago Press, vol. 127(4), pages 1599-1628.
    5. Matthew Embrey & Guillaume R. Fréchette & Steven F. Lehrer, 2015. "Bargaining and Reputation: An Experiment on Bargaining in the Presence of Behavioural Types," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 82(2), pages 608-631.
    6. Gregory Lewis, 2011. "Asymmetric Information, Adverse Selection and Online Disclosure: The Case of eBay Motors," American Economic Review, American Economic Association, vol. 101(4), pages 1535-1546, June.
    7. Kyle Bagwell & Robert W. Staiger & Ali Yurukoglu, 2020. "Multilateral Trade Bargaining: A First Look at the GATT Bargaining Records," American Economic Journal: Applied Economics, American Economic Association, vol. 12(3), pages 72-105, July.
    8. Kambe, Shinsuke, 1999. "Bargaining with Imperfect Commitment," Games and Economic Behavior, Elsevier, vol. 28(2), pages 217-237, August.
    9. Abreu, Dilip & Sethi, Rajiv, 2003. "Evolutionary stability in a reputational model of bargaining," Games and Economic Behavior, Elsevier, vol. 44(2), pages 195-216, August.
    10. March, Christoph, 2021. "Strategic interactions between humans and artificial intelligence: Lessons from experiments with computer players," Journal of Economic Psychology, Elsevier, vol. 87(C).
    11. David Goldreich & Lukasz Pomorski, 2011. "Initiating Bargaining," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(4), pages 1299-1328.
    12. Weinstein, Jonathan & Yildiz, Muhamet, 2016. "Reputation without commitment in finitely-repeated games," Theoretical Economics, Econometric Society, vol. 11(1), January.
    13. Matthew Backus & Thomas Blakee & Brad Larsen & Steven Tadelis, 2020. "Sequential Bargaining in the Field: Evidence from Millions of Online Bargaining Interactions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 135(3), pages 1319-1361.
    14. Alp E. Atakan & Mehmet Ekmekci, 2014. "Bargaining and Reputation in Search Markets," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 81(1), pages 1-29.
    15. Yola Engler & Lionel Page, 2022. "Driving a hard bargain is a balancing act: how social preferences constrain the negotiation process," Theory and Decision, Springer, vol. 93(1), pages 7-36, July.
    16. Peter C. Cramton, 1992. "Strategic Delay in Bargaining with Two-Sided Uncertainty," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 59(1), pages 205-225.
    17. Dilip Abreu & Faruk Gul, 2000. "Bargaining and Reputation," Econometrica, Econometric Society, vol. 68(1), pages 85-118, January.
    18. Kreps, David M., 1990. "Game Theory and Economic Modelling," OUP Catalogue, Oxford University Press, number 9780198283812.
    19. Jack Fanning, 2016. "Reputational Bargaining and Deadlines," Econometrica, Econometric Society, vol. 84, pages 1131-1179, May.
    20. Ken Binmore & Avner Shared & John Sutton, 1989. "An Outside Option Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 104(4), pages 753-770.
    21. Straub, Paul G. & Murnighan, J. Keith, 1995. "An experimental investigation of ultimatum games: information, fairness, expectations, and lowest acceptable offers," Journal of Economic Behavior & Organization, Elsevier, vol. 27(3), pages 345-364, August.
    22. Anat R. Admati & Motty Perry, 1987. "Strategic Delay in Bargaining," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 54(3), pages 345-364.
    23. Shaked, Avner & Sutton, John, 1984. "Involuntary Unemployment as a Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 52(6), pages 1351-1364, November.
    24. Dilip Abreu & David Pearce, 2007. "Bargaining, Reputation, and Equilibrium Selection in Repeated Games with Contracts," Econometrica, Econometric Society, vol. 75(3), pages 653-710, May.
    25. Jack Fanning & Alexander Wolitzky, 2022. "Reputational Bargaining," Springer Books, in: Emin Karagözoğlu & Kyle B. Hyndman (ed.), Bargaining, chapter 0, pages 35-60, Springer.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chessa, Michela & Hanaki, Nobuyuki & Lardon, Aymeric & Yamada, Takashi, 2022. "The effect of choosing a proposer through a bidding procedure in implementing the Shapley value," Journal of Economic Psychology, Elsevier, vol. 93(C).
    2. Petrowsky, Hannes M. & Schweinsberg, Martin & Seitz, Lennart & Funk, Burkhardt & Loschelder, David D., 2023. "Deal or no deal? How round vs precise percentage offers and price-ending mimicry affect impasse risk in over 25 million eBay negotiations," Journal of Economic Psychology, Elsevier, vol. 94(C).
    3. Xue, Lian & Sitzia, Stefania & Turocy, Theodore L., 2023. "Concord and contention in a dynamic unstructured bargaining experiment with costly conflict," Journal of Economic Psychology, Elsevier, vol. 97(C).
    4. Fanning, Jack, 2022. "Fairness and the Coase conjecture," Journal of Economic Psychology, Elsevier, vol. 93(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jonas Send & Marco Serena, 2021. "An Empirical Analysis of Stubborn Bargaining," Working Papers tax-mpg-rps-2021-05, Max Planck Institute for Tax Law and Public Finance.
    2. Sanktjohanser, Anna, 2022. "Optimally Stubborn," TSE Working Papers 22-1367, Toulouse School of Economics (TSE).
    3. Basak, Deepal, 2023. "Bargaining under almost complete information," Journal of Economic Theory, Elsevier, vol. 214(C).
    4. Mehmet Ekmekci & Hanzhe Zhang, 2021. "Reputational Bargaining with Ultimatum Opportunities," Papers 2105.01581, arXiv.org.
    5. Heggedal, Tom-Reiel & Helland, Leif & Våge Knutsen, Magnus, 2022. "The power of outside options in the presence of obstinate types," Games and Economic Behavior, Elsevier, vol. 136(C), pages 454-468.
    6. Miettinen, Topi & Perea, Andrés, 2015. "Commitment in alternating offers bargaining," Mathematical Social Sciences, Elsevier, vol. 76(C), pages 12-18.
    7. Selçuk Özyurt, 2015. "Searching for a Bargain: Power of Strategic Commitment," American Economic Journal: Microeconomics, American Economic Association, vol. 7(1), pages 320-353, February.
    8. Yola Engler & Lionel Page, 2022. "Driving a hard bargain is a balancing act: how social preferences constrain the negotiation process," Theory and Decision, Springer, vol. 93(1), pages 7-36, July.
    9. Fanning, Jack, 2018. "No compromise: Uncertain costs in reputational bargaining," Journal of Economic Theory, Elsevier, vol. 175(C), pages 518-555.
    10. Olivier Bochet & Manshu Khanna & Simon Siegenthaler, 2024. "Beyond Dividing the Pie: Multi-Issue Bargaining in the Laboratory," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 163-191.
    11. Abreu, Dilip & Pearce, David G. & Stacchetti, Ennio, 2015. "One-sided uncertainty and delay in reputational bargaining," Theoretical Economics, Econometric Society, vol. 10(3), September.
    12. Tsoy, Anton, 2018. "Alternating-offer bargaining with the global games information structure," Theoretical Economics, Econometric Society, vol. 13(2), May.
    13. Anna Sanktjohanser, 2020. "Optimally Stubborn," Cowles Foundation Discussion Papers 2255, Cowles Foundation for Research in Economics, Yale University.
    14. Kang Rong, 2015. "Bargaining with split-the-difference arbitration," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 45(2), pages 441-455, September.
    15. Johannes Hörner & Nicolas Sahuguet, 2011. "A war of attrition with endogenous effort levels," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 47(1), pages 1-27, May.
    16. Ellingsen, Tore & Miettinen, Topi, 2014. "Tough negotiations: Bilateral bargaining with durable commitments," Games and Economic Behavior, Elsevier, vol. 87(C), pages 353-366.
    17. Britz, V., 2010. "Optimal value commitment in bilateral bargaining," Research Memorandum 056, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    18. Dilip Abreu & David G. Pearce, 2006. "Reputational Wars of Attrition with Complex Bargaining Postures," Levine's Working Paper Archive 122247000000001218, David K. Levine.
    19. Ortner, Juan, 2023. "Bargaining with evolving private information," Theoretical Economics, Econometric Society, vol. 18(3), July.
    20. D. Abreu & D. Pearce, 2000. "Bargaining, Reputation and Equilibrium Selection in Repeated Games," Princeton Economic Theory Papers 00f2, Economics Department, Princeton University.

    More about this item

    Keywords

    Bargaining; Stubbornness; eBay;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joepsy:v:90:y:2022:i:c:s0167487022000320. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/joep .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.