Faculty of Economics and Business Administration Publications Database

Contract Design and Bargaining Power

Volume: 74
Number: 2
Pages: 171 - 176
Month: January
ISSN-Print: 0165-1765
Link External Source: Online Version
Year: 2002
Keywords: Screening; Mechanism design; Regulation
Abstract: It is a common assumption in contract theory that the uninformed side makes a take-it-or-leave-it proposal. In contrast, this paper explores a model which allows a shift in bargainingpower continuously between the two parties. Endowing the informed side with more bargainingpower gradually reduces distortions.