Agenda Formation in Issue-by-Issue Bargaining Games.

This paper investigates the agenda formation problem by means of two-player two-cake sequential bargaining models. Players differ not only in their time preferences but also for their cake valuations; moreover they face a risk of breakdown in the negotiation process. The main model is characterised by risk of breakdown after the agreement on the first issue, transmission of delays between the negotiations over the two issues, and alternating offer (both after a rejection and an acceptance). Alternative models also are analysed to highlight the complex interplay of forces in the bargaining process over different issues.