The Nash bargaining solution: sometimes more utilitarian, sometimes more egalitarian

Research output: Contribution to journalArticlepeer-review

Abstract

The first-order condition of the Nash bargaining solution equates the ratio of utilities to the ratio of marginal utilities. It turns out that this common ratio plays a role in determining whether the Nash solution, roughly speaking, is “more utilitarian” or “more egalitarian.” More specifically, I propose a sense of proximity to utilitarianism and/or egalitarianism according to which, in bargaining problems with distinct utilitarian and egalitarian points, the Nash solution is closer to utilitarianism if the aforementioned ratio is smaller than one, and closer to egalitarianism if that ratio is greater than one.

Original languageAmerican English
Pages (from-to)457-464
Number of pages8
JournalTheory and Decision
Volume95
Issue number3
DOIs
StatePublished - Oct 2023

Keywords

  • Bargaining
  • Egalitarianism
  • Nash solution
  • Utilitarianism

All Science Journal Classification (ASJC) codes

  • General Decision Sciences
  • Developmental and Educational Psychology
  • Arts and Humanities (miscellaneous)
  • General Economics,Econometrics and Finance
  • Applied Psychology
  • Computer Science Applications
  • General Social Sciences

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