Bargaining with offer dependent break-down probabilities

This paper examines a new general version of the alternating offer method, when the break-down probabilities depend on the latest offers of the two players. Under general conditions we prove that the process converges, and under more restrictive conditions it terminates in finitely many steps. This process can be applied to more general cases than most methods known in the literature, since the feasible payoff set does not need to be convex.