Strategic Effects and Incentives in Multi-issue Bargaining Games

important to his opponent. The incentives that player need to take into account may
work in opposite directions. However, we show under which conditions parties can
have the same preferences over agendas.

The paper is organised as follows. The next section specifies the model. The
solution of the model and its properties are included in section 2.1. This section also
contains the analysis of the strategic effects that characterised the game. In section
3.1, parties are first allowed to negotiate according to a different order of the issues,
then they form their preferences over agenda. In section 3, we show that there is an
efficient agenda both when there is consensus over the importance of the issue and
when there is not. Section 4 focuses on the case of a difficult/urgent issue.

2Themodel

We consider a two-stage bargaining game in which at each stage two players, named
i with i =1, 2, attempt to divide a surplus. The bargaining game is sequential in
the sense that the second stage can start only once a division on the first surplus
is agreed. In each stage, players bargain according to a standard alternating-offer
procedure (Rubinstein, 1982). That is, time is discrete, t =0, 1, ..., at t =0, player
1 can make an offer to player 2 who can either accept or reject it. If player 2 rejects
it, then he can make a counter-proposal after an interval of time ∆ passes. If there
is an acceptance then the first bargaining stage ends. We assume that an interval of

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