Rent shifting and the order of negotiations
Volume: 25, Issue: 5, Pages: 1109 - 1125
Published: Oct 1, 2007
Abstract
When two sellers negotiate terms of trade with a common buyer, the order in which the negotiations occur can affect the buyer's payoff. This suggests that the buyer may have preferences over which seller to negotiate with first. We find that when the efficient outcome calls for the buyer to purchase from only one seller, the buyer weakly prefers to negotiate first with the inefficient seller, and when the efficient outcome calls for the buyer to...
Paper Details
Title
Rent shifting and the order of negotiations
Published Date
Oct 1, 2007
Volume
25
Issue
5
Pages
1109 - 1125
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