Oechssler, Jörg ; Roomets, Alex
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Abstract
Two partners try to dissolve a partnership that owns an asset of ambiguous value, where the value is determined ex post by a draw from an Ellsberg urn. In a within-subject experiment, subjects make decisions in three different bargaining mechanisms: unstructured bargaining, the Texas shoot-out, and a K + 1 auction. We find that the K +1 auction is the most e¢ cient mechanism, which is in line with theory. Free format bargaining yields a surprising number of disagreements, which are not usually observed when the partnership has a certain or risky value.
| Document type: | Working paper |
|---|---|
| Series Name: | Discussion Paper Series / University of Heidelberg, Department of Economics |
| Volume: | 0733 |
| Place of Publication: | Heidelberg |
| Date Deposited: | 22 Sep 2023 14:09 |
| Date: | September 2023 |
| Number of Pages: | 34 |
| Faculties / Institutes: | The Faculty of Economics and Social Studies > Alfred-Weber-Institut for Economics |
| DDC-classification: | 330 Economics |
| Uncontrolled Keywords: | bargaining, ambiguity, experiment |
| Series: | Discussion Paper Series / University of Heidelberg, Department of Economics |
