Abstract
We consider land rental between a single tenant and several lessors. The tenant should negotiate sequentially with each lessor for the available land. In each stage, we apply the Nash bargaining solution, as a short-cut to solving non-cooperative bargaining games. Our results imply that, when all land is necessary, a uniform price per unit is more favorable for the tenant than a lessor-dependent price. Furthermore, a lessor is better off with a lessor-dependent price only when negotiating first. For the tenant, lessors’ merging is relevant with lessor-dependent price but not with uniform price.
| Original language | English |
|---|---|
| Pages (from-to) | 65-99 |
| Number of pages | 35 |
| Journal | Review of Economic Design |
| Volume | 24 |
| Issue number | 1-2 |
| DOIs | |
| State | Published - 1 Jun 2020 |
| Externally published | Yes |
Bibliographical note
Funding Information:Alfredo Valencia-Toledo thanks the Ministry of Education of Peru for its financial support through the “Beca Presidente de la República” Grant of the “Programa Nacional de Becas y Crédito Educativo (PRONABEC)”. Juan Vidal-Puga acknowledges financial support from the Spanish Ministerio de Economía y Competitividad through Grant ECO2014-52616-R., Ministerio de Economía, Industria y Competitividad through Grant ECO2017-82241-R, and Xunta de Galicia (ED431B 2019/34)
Publisher Copyright:
© 2020, Springer-Verlag GmbH Germany, part of Springer Nature.
Keywords
- Bargaining
- Land rental
- Nash solution
- Non-cooperative game