Nash bargaining and renegotiation with social preferences: case of the roundwood log supply contracts in the French timber market - Archive ouverte HAL Access content directly
Journal Articles Forest Policy and Economics Year : 2016

Nash bargaining and renegotiation with social preferences: case of the roundwood log supply contracts in the French timber market

Abstract

By considering the French forest-based sector, we study both negotiation and renegotiation between a public timber and roundwood log supplier, which can be either public-interest-oriented or profit-maximizing, and a profit-maximizing lumber manufacturer. We first prove that the Nash bargaining game yields a unique equilibrium log supply contract, at which the negotiation takes only place on the prices. We then find that the expected profit-maximizing is achieved when the supplier's public interest and the manufacturer's bargaining power are strategic substitutes. The renegotiation reveals the presence of a memory effect over the quantities issued from bargaining. Our results can be generalized to all economic settings that revolve around public interest and commodity risk management.
No file

Dates and versions

hal-01352691 , version 1 (08-08-2016)

Identifiers

Cite

Ahmed Barkaoui, Arnaud Z. Dragicevic. Nash bargaining and renegotiation with social preferences: case of the roundwood log supply contracts in the French timber market. Forest Policy and Economics, 2016, 69, pp.90-100. ⟨10.1016/j.forpol.2016.04.007⟩. ⟨hal-01352691⟩
80 View
0 Download

Altmetric

Share

Gmail Facebook X LinkedIn More