-This is especially true if we drop the assumption that the type "tags" have no in-game significance (other than being visible for coordination) and introduce an asymmetric payoff matrix. Consider the Nash bargaining game: two agents have to decide how to divide a pie with 10 slices, but if their demands are incompatible (like when I demand 7 slices and you also demand 7 slices, but 7 + 7 = 14 is greater than 10), then the pie explodes, and no one gets any pie. If different types of agents have different fallback options, that affects their incentives in the bargaining game: if you wouldn't have anything to eat if you didn't get any pie, then you might want to make a conservative demand, like 3 slices, in order to ensure that you get _some_ pie even if it turns out that I'm a greedy jerk who demands 7 slices. But if I have a sandwich that's as valuable to me as 2½ slices of pie, then I'm not particularly worried about you being a greedy jerk who demands 7 slices: to me, the difference between a successful 3-slice demand and failing to make a deal at all is only half a slice, which gives me an incentive to demand more, because I have less to lose than you if bargaining fails.
+<a id="threatpoints-and-bargaining"></a>This is especially true if we drop the assumption that the type "tags" have no in-game significance (other than being visible for coordination) and introduce an asymmetric payoff matrix. Consider the Nash bargaining game: two agents have to decide how to divide a pie with 10 slices, but if their demands are incompatible (like when I demand 7 slices and you also demand 7 slices, but 7 + 7 = 14 is greater than 10), then the pie explodes, and no one gets any pie. If different types of agents have different fallback options, that affects their incentives in the bargaining game: if you wouldn't have anything to eat if you didn't get any pie, then you might want to make a conservative demand, like 3 slices, in order to ensure that you get _some_ pie even if it turns out that I'm a greedy jerk who demands 7 slices. But if I have a sandwich that's as valuable to me as 2½ slices of pie, then I'm not particularly worried about you being a greedy jerk who demands 7 slices: to me, the difference between a successful 3-slice demand and failing to make a deal at all is only half a slice, which gives me an incentive to demand more, because I have less to lose than you if bargaining fails.