Agenda-Setter Power Dynamics: Learning in Multi-Issue Bargaining

T. Renee Bowen, Stefan Krasa and Ilwoo Hwang

No 15406, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We study a dynamic bargaining model 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†. The 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 in an intermediate interval of beliefs. The presence of “difficult†issues can induce more compromise as the players have incentives to avoid learning.

Keywords: Bargaining; Power; Gridlock; Learning (search for similar items in EconPapers)
JEL-codes: C78 D72 D74 D83 (search for similar items in EconPapers)
Date: 2020-10
New Economics Papers: this item is included in nep-gth and nep-mic
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