A Note On Equilibrium Uniqueness In The Baron-Ferejohn Model
Source: Charles University
The Baron-Ferejohn multilateral bargaining model predicts a payoff-unique Stationary Subgame Perfect Equilibrium (SSPE) in which players' equilibrium strategies are not uniquely determined. In this paper, the authors present a modified version of the Baron-Ferejohn model by introducing veto players and provide a sufficient condition to obtain a truly unique SSPE in terms of payoffs as well as players' equilibrium strategies. The Baron-Ferejohn model is one of the most widely used legislative bargaining models to study different aspects of distributive politics and government policy-making.