Draft Comments Welcomed

Although scholars of international security share a skepticism for the extent to which agreements can be externally enforced, much of the extant game-theoretic work involves strong forms of commitment. We build on the canonical model of crisis bargaining to gain insights about the role of two forms of commitment in bargaining—the ability to commit to a settlement and the ability to commit to end negotiations and initiate war fighting. We show that, contrary to the received wisdom, allowing a proposer to retract their offer after learning of its acceptance need not lead to a series of ever increasing demands. Instead, a rational actor is best off honoring the accepted agreement in crisis bargaining, even though the act of accepting an offer changes the the proposer’s beliefs about the distribution of power and the accepting country’s resolve. On the other hand, allowing a proposer to continue bargaining in lieu of fighting does change the dynamics of bargaining, although this effect diminishes as players become more patient. Finally, when there is not commitment to offers or fighting after a rejected proposal, the one period play of the ultimatum game remains a perfect bayesian equilibrium to the dynamic bargaining game. ∗We thank Avi Acharya, Alex Hirsch, Matias Iaryczower, and David Myatt for useful discussions on this topic. We appreciation helpful comments at the University Wisconsin, Yale and the University of Rochester.