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About: Sequential bargaining     Goto   Sponge   NotDistinct   Permalink

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Squential bargaining (also known as alternate-moves bargaining, alternating-offers protocol, etc.) is a structured form of bargaining between two participants, in which the participants take turns in making offers. Initially, person #1 has the right to make an offer to person #2. If person #2 accepts the offer, then an agreement is reached and the process ends. If person #2 rejects the offer, then the participants switch turns, and now it is the turn of person #2 to make an offer (which is often called a counter-offer). The people keep switching turns until either an agreement is reached, or the process ends with a disagreement due to a certain end condition. Several end conditions are common, for example: