Personal power dynamics in bargaining

Renee Bowen, Ilwoo Hwang and Stefan Krasa

Journal of Economic Theory, 2022, vol. 205, issue C

Abstract: We study bargaining between a fixed agenda-setter and responder over successive issues. If the responder rejects the setter's proposal, the setter can attempt to assert her will to implement her ideal and will succeed with a probability that depends on her “personal power”. Players learn about the setter's power as gridlock persists. Gridlock occurs when the setter's perceived power is either too high or too low, and the players reach compromise when the setter has moderate personal power. The presence of “difficult” issues can induce more compromise as the players have incentives to avoid testing the setter's power.

Keywords: Bargaining; Personal power; Gridlock; Learning (search for similar items in EconPapers)
JEL-codes: C78 D72 D74 D83 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Personal Power Dynamics in Bargaining (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:205:y:2022:i:c:s002205312200120x

DOI: 10.1016/j.jet.2022.105530

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