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Location of an undesirable facility on a network: A bargaining approach

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  • Yamaguchi, Kazuo

Abstract

We examine a model where, on a line network, individuals collectively choose the location of an undesirable public facility through bargaining with the unanimity rule. We show the existence of a stationary subgame perfect equilibrium and the characterization of stationary subgame perfect equilibria when the discount factor is sufficiently large. Furthermore, we show that as the discount factor tends to 1, the equilibrium location can converge to a location that is least desirable according to both the Benthamite and Rawlsian criteria.

Suggested Citation

  • Yamaguchi, Kazuo, 2011. "Location of an undesirable facility on a network: A bargaining approach," Mathematical Social Sciences, Elsevier, vol. 62(2), pages 104-108, September.
    • Handle: RePEc:eee:matsoc:v:62:y:2011:i:2:p:104-108
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    References listed on IDEAS

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    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Hansen, Pierre & Thisse, Jacques-Francois, 1981. "Outcomes of voting and planning : Condorcet, Weber and Rawls locations," Journal of Public Economics, Elsevier, vol. 16(1), pages 1-15, August.
    3. Kawamori, Tomohiko & Yamaguchi, Kazuo, 2010. "Outcomes of bargaining and planning in single facility location problems," Mathematical Social Sciences, Elsevier, vol. 59(1), pages 38-45, January.
    4. Herings, P. Jean-Jacques & Predtetchinski, Arkadi, 2010. "One-dimensional bargaining with Markov recognition probabilities," Journal of Economic Theory, Elsevier, vol. 145(1), pages 189-215, January.
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