The Research Consortium

Allied Laboratories, Benchmark Research and Consolidated Sciences (hereafter called simply A, B
and C) are three small independent research companies in the biometrics sector. As the government is
trying to promote the country’s strength in this growing sector, it has established a fund that will
provide a grant to a consortium of 2 or more organisations. However, only one grant will be awarded,
and the government will not grant funding to A, B or C alone.

A, B and C differ in terms of their laboratory facilities, staff numbers and areas of expertise.
Consequently, depending on the members of the consortium, they will qualify for different amounts of
funding. The government has indicated that the following amount of funds would be awarded,
depending on the consortium formed.

Consortium Payoff
(€000)
A alone 0
B alone 0
C alone 0
A and B 118
A and C 84
B and C 50
A, B and C 121

Your aim is to meet with representatives from the other two companies to negotiate the best deal you
can get for your organisation. Your goal is to bring in as much funding as possible for your company.
Your payoff will be compared with the payoffs achieved by others playing the same role as you.

When negotiations begin, all three companies can meet together. If two of the three companies wish to
speak privately, they may do so, and the third company may not interrupt them to rejoin the
discussions for at least 3 minutes.

If any agreement is reached, it must last for at least 5 minutes before negotiations can conclude;
specifically, an initial agreement must be signed by all (two or three) members of the consortium, then
signed again 5 minutes later. Any agreement not signed twice in this manner is null and void; any
agreement signed twice in this manner is final. Note that the agreement need only be signed by
members of the consortium; if one member is left out, their signature is not required.

The 5 minute re-signing procedure is waived in the final 5 minutes of the exercise; during these 5
minutes, any initial signed agreement is a final agreement.

Any agreement entered into by your organisation must list the companies in the consortium and each
company’s share of the grant.

First signing Time:

Who is in the consortium and how much money does each get?

Signatures of representatives from each consortium member:

Second signing Time: (5 minutes must have elapsed since first signing)

Signatures of representatives from each consortium member: