Bargaining as a dynamical system

TLDR: In this paper, an elliptic relationship between offer and response is used to derive predictions about the outcome states of bargaining systems on the basis of the bargainers' interactions. But the results suggest that the elliptic model provides a reasonable, though not perfect, explanation of bargaining outcome.

Abstract: Mathematically based dynamical systems, by producing abstract representations of phenomena that change as a function of time, provide ideal models of diverse physical, biological, and social systems. This paper focuses on bargaining and negotiation, and, as such, deals with decision making in human, dyadic group systems. In particular, bargaining is viewed as an interactive process in which the communications of one bargainer affect those of the other, and vice versa. Using concepts from the study of dynamical systems, an elliptic relationship between offer and response is postulated. This relationship is used to derive predictions about the outcome states of bargaining systems on the basis of the bargainers' interactions. The results suggest that the elliptic model provides a reasonable, though not perfect, explanation of bargaining outcome.