Article ID Journal Published Year Pages File Type
5062357 Economics Letters 2006 7 Pages PDF
Abstract

When time preferences differ, non-stationary contracts strictly dominate stationary contracts. The unique equilibrium converges to the Nash bargaining solution in which the less patient player always receives 50% of his utopia payoff, regardless of the difference between the players' discount rates.

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Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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Different time preferences and non-stationary contracts in negotiations
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