I apply the 'Theory of Social Situations' (Greenberg, 1990) to a special class of extensive form games of perfect information and without chance moves. I prove the existence of an 'Optimistic Stable Standard of Behavior' (OSSB) which is associated with such games. This class includes all n-person discounted sequential bargaining games where a finite set of strictly positive offers can be made at each stage. The derived OSSB yields an appealing selection from among the subgame perfect paths. As is always the case, OSSB is strongly related to the von Neumann and Morgenstern abstract stable sets.
- Rubinstein's discrete bargaining
ASJC Scopus subject areas
- Sociology and Political Science
- Social Sciences (all)
- Psychology (all)
- Statistics, Probability and Uncertainty