Risk Sensitivity, Independence of Irrelevant Alternatives and Continuity of Bargaining Solutions

Bargaining solutions are considered which have the following four properties: individual rationality, Pareto optimality, independence of equivalent utility representations, and independence of irrelevant alternatives. A main result of this paper is a simple proof of the fact that all such bargaining solutions are risk sensitive. Further a description is given of all bargaining solutions satisfying the four mentioned properties. Finally, a continuous bargaining solution, satisfying the first three properties, is given which is not risk sensitive.