An Improved Simultaneous-Revelation Resolution Procedure that Induces Truthfulness

Linlan Zhang, Chunmei Wu, Zhongyan Wang, Zefang Li

Department of the Basics, Air Force Radar Academy, Wuhan, Hubei, China.
Department of the Basics, Air Force Radar Academy, Wuhan, Hubei, China.
Institute of Computer Technology, Wuhan Institute of Technology, Wuhan, Hubei, China..
Institute of Systems Engineering, Huazhong University of Science and Technology, Wuhan, Hubei,China.

DOI: 10.4236/jssm.2009.22012                

Abstract

Alternating-offer bargaining protocol is the most predominant way for solving bilateral bargaining problem in daily life. However, alternating-offer consumed more time and caused a lower efficiency in some cases. One proposed solution is called simultaneous-revelation resolution by which both parties reveal their reservation prices at the same time. But most simultaneous-revelation resolution procedures are inefficient because they encourage exaggerations. But it is fast and uncomplicated, this resolution procedure still has merit—especially if the parties can refrain from undue exaggera-tion. The paper designs a truthful mechanism for simultaneous-offer bargaining negotiation. In this mechanism, a rule manipulator can induce buyer and seller both to reveal their real prices by introducing suitable adjustment functions. And we show the honest revelations are in Nash equilibrium.

Keywords

mechanism design, simultaneous-offer, bargaining, truthfulness, nash equilibrium

Conflicts of Interest

The authors declare no conflicts of interest.

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