Threat bargaining problems with incomplete information and Nash's solution

Abstract

In this paper we extend the framework of threat bargaining games to include those with incomplete information. In this set up we address ourselves to two significant problems: (1) Under what conditions would 'truthful' revelation of the disagreement payoffs be a Nash equilibrium of the threat bargaining game? (2) Obtaining a characterization of the Nash bargaining solution without the Independence of Irrelevant alternation assumption. Our framework of analysis is general enough to include within its purview the study of non-cooperative bargaining problems, played by Bayesian players, although the specific problems addressed to in this paper does not fall in that category.