This paper develops a dynamic model of the bargaining between a legislature and an executive with veto power. The dynamic nature of the model provides the executive with incentives to use the veto as a reputation building device in order to gain more favorable legislative outcomes. The model illustrates that the implicit threat of building a reputation may cause the legislature will be more accommodating in its proposals to the executive. The model illustrates the possibility of a "honeymoon period" of legislative accommodation followed by a decline in the president's influence. This paper also explores ways in which the legislature might mitigate the effects of presidential reputation building.
All Science Journal Classification (ASJC) codes
- Economics and Econometrics