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Collective Hold-Up / Matias Iaryczower, Santiago Oliveros.
- Format:
- Book
- Author/Creator:
- Iaryczower, Matias.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w29984.
- NBER working paper series no. w29984
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2022.
- Summary:
- We consider dynamic processes of coalition formation in which a principal bargains sequentially with a group of agents. This problem is at the core of a variety of applications in economics and politics, including a lobbyist seeking to pass a bill, an entrepreneur setting up a start-up, or a firm seeking the approval of corrupt bureaucrats. We show that when the principal's willingness to pay is high, strengthening the bargaining position of the agents generates delay and reduces agents' welfare. This occurs in spite of the lack of informational asymmetries or discriminatory offers. When this collective action problem is severe enough, agents prefer to give up considerable bargaining power in favor of the principal.
- Notes:
- Print version record
- April 2022.
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