TITLE:
An Improved Simultaneous-Revelation Resolution Procedure that Induces Truthfulness
AUTHORS:
Linlan Zhang, Chunmei Wu, Zhongyan Wang, Zefang Li
KEYWORDS:
mechanism design, simultaneous-offer, bargaining, truthfulness, nash equilibrium
JOURNAL NAME:
Journal of Service Science and Management,
Vol.2 No.2,
June
17,
2009
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.