Bargaining power and negotiation strategy: examining the Greek bailouts, 2010–2015

Abstract

ABSTRACTUnder what conditions do governments choose hard or soft bargaining strategies in intergovernmental negotiations? Applying a bargaining power model in two-level games, I explore the factors that explain Greek strategy in bailout negotiations during the period 2010–2015. Governments with fewer power resources, worse best alternative to negotiated agreement and fewer domestic constraints are more likely to follow a soft bargaining strategy. But the choice of strategy is as much the result of structural features of bargaining power as it is of ideology and the perception of success (or failure) in iterative bargaining rounds. The findings have implications for bargaining power models and European Union bailout negotiations.