Stationary Equilibria In A Bargaining Model

We apply a cost-saving approach to studying a number of mutual defense games. This approach is founded on computing cost savings from interior borders of the members of an alliance. We show that location vis-à-vis potential allies and border attributes matters for alliance formation and burden sharing if an alliance were to form. A “NATO-Ukraine-Slovakia” mutual defense game is studied both in the short- and in the long run. The course of action countries should follow to achieve a mutually acceptable utility distribution is under study. We prove the existence of a stationary strategy equilibrium in an n -person bargaining game when players’ iii utility functions are concave.