Abstract

http://ssrn.com/abstract=1729298
 
 

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Delays and Partial Agreements in Multi-Issue Bargaining


Avidit Raj Acharya


Princeton University - Woodrow Wilson School of Public and International Affairs

Juan Matias Ortner


Princeton University - Department of Economics

July 30, 2010

Economic Theory Center Working Paper No. 004-2010

Abstract:     
We model a situation in which two players bargain over two issues (pies), one of which can only be resolved at a future date. We find that if the players value the issues asymmetrically (one player considers the existing issue more important than the future one, while the other player has the opposite valuation) then they may delay agreement on the first issue until the second one is finally on the table. If we allow for partial agreements, then the players never leave an issue completely unresolved. They either make a partial agreement on the first issue, and wait for the second one to emerge before completing the agreement; or they come to complete agreements on each of the issues at their earliest possible dates. We discuss applications to legislative bargaining and international trade negotiations.

Number of Pages in PDF File: 30

Keywords: Bargaining, Multiple Issues, Delay, Hold-Up, Inefficiency

JEL Classification: C73, C78

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Date posted: December 22, 2010  

Suggested Citation

Acharya, Avidit Raj and Ortner, Juan Matias, Delays and Partial Agreements in Multi-Issue Bargaining (July 30, 2010). Economic Theory Center Working Paper No. 004-2010. Available at SSRN: http://ssrn.com/abstract=1729298 or http://dx.doi.org/10.2139/ssrn.1729298

Contact Information

Avidit Raj Acharya (Contact Author)
Princeton University - Woodrow Wilson School of Public and International Affairs ( email )
Princeton University
Princeton, NJ 08544-1021
United States
Juan Matias Ortner
Princeton University - Department of Economics ( email )
Princeton, NJ 08544-1021
United States
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