The Rubinstein Bargaining Model is a class of bargaining games in game theory in which two players make alternating offers over how to divide a fixed surplus across an infinite time horizon, each preferring an earlier agreement to a later one. Introduced by Ariel Rubinstein in a 1982 paper, the model shows that this alternating-offers process yields a unique predicted division as the direct outcome of the players' own strategic behavior, in contrast to Nash's earlier bargaining theory, which derives its predicted division from a set of fairness axioms imposed on the outcome.
Facts
StatementIn the unique subgame perfect equilibrium of the model, player 1 receives a share of 1 divided by (1+d) of the surplus and player 2 receives d divided by (1+d), where d is the common discount factor. 1 Classification
Statement Form Connections
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In Branch
Source Rubinstein bargaining model (Wikipedia)
Sources
1. Rubinstein bargaining model (Wikipedia)
Solution section
In this subgame perfect equilibrium, player 1 gets 1/(1+d) while player 2 gets d/(1+d).
Lead section
The original solution concept was introduced by Ariel Rubinstein in his seminal 1982 paper.
In Branch: Game Theory, Lead sentence
ng model refers to a class of bargaining games in game theory featuring alternating offers between two players over an infinite ti
In Group: Equilibria, Bargaining and Cooperative Games, Lead paragraph
Rubinstein bargaining model refers to a class of bargaining games in game theory featuring alternating offers between two players over an infinite time horizon.
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