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rejected, even though they constitute an improvement over the status quo. Rational, utility-
maximizing leaders should always accept deals that increase their party’s gains – even if only
marginally. Agreements can be “sticky”, however, such that accepting the present accord
might impair the ability to obtain further concessions. The 2000 Camp David talks between
Israel and Palestine illustrate this point: there is little doubt that the concessions offered by
Ehud Barak would have improved the Palestinian situation over the status quo. Yet the offers
were rejected by Yasser Arafat. An explanation that does not require us to abandon the
assumption of perfect rationality is that the expected inability to re-negotiate was an important
aspect of the bargaining setup. In other words, Arafat understood that accepting the present
deal implied giving up further demands for a certain period of time.
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Thus, his decision can be
rational if the long-term benefits of striking a better deal tomorrow exceed the short-term
benefits of receiving limited advantages today. Anticipated rigidities explain the reluctance to
accept certain deals, even though they are utility-increasing in the short-term.
Negotiations and the concessions and changes they imply can be so difficult and costly to
reach --- both at the domestic and the international levels --- that both parties implicitly
understand that agreements cannot be re-negotiated at will. Only the scarcity of re-negotiation
opportunities, and their cost, can explain why parties to a negotiation have minimum levels of
expectations that need to be met. If accepting today’s deal implies giving up tomorrow’s, the
parties may not be willing to accept any deal that only marginally increases their utility.
Concessions can be judged insufficient in view of the time needed to reach a new agreement.
Thus, rigidities not only explain why bargaining is infrequent, which by itself is conducive to
war, but also why reaching an agreement can be so difficult.
Moreover, there exist instances in which decisions need to be taken so quickly that there is
no time for negotiation. A decisive offensive military weapon, such that nuclear weapons,
commensurately increases the urgency of decisions and hence the opportunity cost of time to
such a point where reach an agreement is impossible. When time takes such an importance, it
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In fact, Barak even put as a condition that Palestine would give up all of its demands in the future.
Convention