When the total number of periods in the alternating offer sequential bargaining game is finite, there is a unique subgame perfect equilibrium in which the first offer made is accepted. The equilibrium offer is equal to the sum of the decrements in the pie when the first player makes her or his offer. This description is the
A) pie exhaustion theorem
B) alternating offer sequential bargaining equilibrium theorem
C) marginal productivity theorem

Question

Quizplus · Accepted Answer

This is the alternating offer sequential bargaining equilibrium theorem, which states that when the number of periods in the game is finite, there exists a unique subgame perfect equilibrium where the first offer made is accepted. The equilibrium offer is equal to the sum of the decrements in the pie when the first player makes their offer.

When the Total Number of Periods in the Alternating Offer