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Lecture 17 - Backward Induction: Ultimatums and Bargaining

Builds a bargaining model from ultimatum offers to alternating offers, making patience, discounting and knowledge of the bargaining surplus explicit.

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Why it is here

A strong assumptions exercise: the equal-split conclusion in the overview is conditional, and changing patience, information or resources changes the bargaining analysis.

Selection basis: institutional collection. Reason checked 2026-11-07 by agent.

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Editorial judgement: the official course requires introductory microeconomics and uses one-variable calculus, probability and expectation. The introductory subject title does not mean that no preparation is needed.
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Open Yale Courses; original source https://oyc.yale.edu/economics/econ-159/lecture-17. Link by default. Source terms require credit to original faculty, Yale and the course URL, plus licence. Inspect individual credits before copying. Commercial reuse and third-party assets require separate review.. Links, factual metadata and original navigation annotations only. No source page, transcript, image, video or restricted platform metadata is included in the reusable export.

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    About the Course and Requirements sections read, including explicit mathematics and economics prerequisites. Retrieved 2026-11-07.

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