Analysis On Bargaining Region And Process

It is very popular in real life to bargain when trade takes place, but it is very important for determination of spot prices relative to long term or short term prices. Bargaining has been discussed in many models, but few papers are focused on the price interval and the explicit bargaining interval based on it acceptable for the sellers and buyers, both parties in the bargaining. The bargaining interval is a determined condition in existing studies, but how to find the interval is not presented. This issue is the above all problem in the dissertation.The paper starts from the price interval acceptable for the traders in the commodity selection, and then discusses the optimal opportunity selection according to traders' market information and their own utilities. Thus, the concept of effective interval is presented in this dissertation, which is how to choose commodities and traders at the beginning of bargaining.It is impossible to bargain one-to-one for all sellers and buyers in real life. Because different buyers cannot be distinguished, the seller may bargain with many buyers. At that time the effective interval changes, the seller tries to maximize his income in unit time, while buyers make decision independently.After the effective interval is analyzed, the dissertation moves on to the bargaining process, which is divided into two different stages, information exchanging and bargaining. Quoting-dickering occurs in the stage of information exchanging, but it is different from that in the stage of bargaining. The former can be interpreted as that a stable "common interval" are introduced by all kinds of information exchanging, in which the trade ceases if any party expects the final price is not in the interval and the other can not change his expectation. And quoting-dickering is one kind of information exchanging. In the stage of bargaining, quoting-dickering makes information exchanging completed, and the seller and buyer have the motivation to continue their trade, compromise with each other in the "common interval" to complete the trade.In the stage of bargaining, quoting-dickering follows the principle of fair bargaining. The fairness refers to the evaluation of traders as a whole, which doesn't mean the money dickered at one process of bargaining equals to the concession.