This Article Full Text (PDF) References Alert me when this article is cited Alert me if a correction is posted Services Email this article to a friend Similar articles in this journal Alert me to new issues of the journal Add to Saved Citations Download to citation manager Request Permissions Request Reprints Add to My Marked Citations Citing Articles Citing Articles via HighWire Citing Articles via Google Scholar Citing Articles via Scopus Google Scholar Articles by Curry, A. F. Articles by Pecorino, P. Search for Related Content Social Bookmarking                         What's this?

The Use of Final Offer Arbitration as a Screening Device

University of Tennessee

Paul Pecorino

University of Mississippi

Arbitration outcomes are uncertain. When risk preferences are unobservable, players may make offers that attempt to extract the willingness of risk-averse bargaining partners to pay to avoid the uncertainties of arbitration. When such a "hard" offer is made to a risk-neutral bargaining partner, it will be refused and arbitration will result. This is true even when the distribution of outcomes is common knowledge. Importantly, risk preferences may be difficult to communicate, even if it is in the interest of both parties to do so.

Journal of Conflict Resolution, Vol. 37, No. 4, 655-669 (1993)
DOI: 10.1177/0022002793037004004


CiteULike    Complore    Connotea    Del.icio.us    Digg    Reddit    Technorati    Twitter    What's this?

This article has been cited by other articles:

				D. J. Faurot Equilibrium Explanation of Bargaining and Arbitration in Major League Baseball Journal of Sports Economics, February 1, 2001; 2(1): 22 - 34. [Abstract] [PDF]