We experimentally study unanimity and majority voting rules in multilateral bargaining environments with stochastic future surplus. In these settings, reaching agreement when expected future surplus is sufficiently higher than the current surplus is inefficient. Theoretically, such inefficiencies never arise under unanimity rule but can arise under majority rule as players try to avoid endogenous risk of being excluded from the winning coalitions in the future. We find strong support for this prediction both when the unanimity rule is predicted to lead to more delays, and when both rules should lead to identical levels of delays. We also find that there are more delays than predicted under the majority rule. Using data from conversations among the bargainers and the type of proposals that are implemented, we find that these deviations arise as a result of more egalitarian sharing than predicted by theory, and therefore, lower risk of being excluded from the winning coalitions in the future.

Bargaining in the Shadow of the Market OCo Selected Papers on Bilateral and Multilateral Bargaining consists of selected research in bargaining carried out by Kalyan Chatterjee by himself and with various co-authors. Chatterjee has been one of the earliest researchers to work on noncooperative bargaining theory and has contributed to bilateral bargaining with parties having private information as well as multilateral coalition formation models. Some of his work in each of these areas finds place here.The main theme of this collection of papers is the nature of negotiations when participants have alternatives to continue negotiating, either by beginning negotiations with a different partner or set of partners or by engaging in time-consuming search for such partners. Chapters in this book include: a noncooperative theory of coalitional bargaining and features a laboratory experiment relevant to this theory as well as an extension to political negotiations, search for alternative partners, the effect of markets and bargaining on incentives of players to invest in the partnership and related papers on incentive compatibility, arbitration and a dynamic model of negotiation. The book also includes a new introduction that puts these papers in the context of the broader literature in the field.

Bargaining in the Shadow of the Market — Selected Papers on Bilateral and Multilateral Bargaining consists of selected research in bargaining carried out by Kalyan Chatterjee by himself and with various co-authors. Chatterjee has been one of the earliest researchers to work on noncooperative bargaining theory and has contributed to bilateral bargaining with parties having private information as well as multilateral coalition formation models. Some of his work in each of these areas finds place here.The main theme of this collection of papers is the nature of negotiations when participants have alternatives to continue negotiating, either by beginning negotiations with a different partner or set of partners or by engaging in time-consuming search for such partners. Chapters in this book include: a noncooperative theory of coalitional bargaining and features a laboratory experiment relevant to this theory as well as an extension to political negotiations, search for alternative partners, the effect of markets and bargaining on incentives of players to invest in the partnership and related papers on incentive compatibility, arbitration and a dynamic model of negotiation. The book also includes a new introduction that puts these papers in the context of the broader literature in the field.