Make Him an Offer He Can’t Refuse: Avoiding Conflicts through Side Payments

Abstract

The equilibrium of a two-stage conflict game with side-payments predicts that with binding stage-one offers, proposers make and responders accept side-payments, generating settlements that strongly favor proposers. When side-payments are non-binding, proposers offer nothing and conflicts always arise. Laboratory experiments confirm that binding side… (More)

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Cite this paper

@inproceedings{Kimbrough2010MakeHA, title={Make Him an Offer He Can’t Refuse: Avoiding Conflicts through Side Payments}, author={Erik O. Kimbrough and Roman M. Sheremeta and Marlon Brando’s}, year={2010} }