Persuasion in veto bargaining

Abstract

AbstractWe consider the classic veto bargaining model but allow the agenda setter to engage in persuasion to convince the veto player to approve her proposal. We show that the proposer‐optimal can be achieved either by providing no information or with a simple binary experiment. Proposer chooses to reveal partial information when there is sufficient expected misalignment with Vetoer. In this case, the opportunity to engage in persuasion strictly benefits Proposer and increases the scope to exercise agenda power. We discuss applications and how the optimal experiment can be implemented in practice.