Bargaining in Legislatures

Abstract

Bargaining in legislatures is conducted according to formal rules specifying who may make proposals and how they will be decided. Legislative outcomes depend on those rules and on the structure of the legislature. Although the social choice literature provides theories about voting equilibria, it does not endogenize the formation of the agenda on which the voting is based and rarely takes into account the institutional structure found in legislatures. In our theory members of the legislature act noncooperatively in choosing strategies to serve their own districts, explicitly taking into account the strategies members adopt in response to the sequential nature of proposal making and voting. The model permits the characterization of a legislative equilibrium reflecting the structure of the legislature and also allows consideration of the choice of elements of that structure in a context in which the standard, institution-free model of social choice theory yields no equilibrium.

Local favoritism in at-large proportional representation systems

“…Theories of legislative decision making emphasize that elected representatives are trading off the virtues of public goods against the attractiveness of spending the money on particularistic goods ('pork') benefitting voters in their home districts (Weingast, Shepsle, and Johnsen, 1981;Baron and Ferejohn, 1989;Volden and Wiseman, 2007;Fréchette, Kagel, and Morelli, 2012). This reasoning fits well with existing evidence from countries using plurality rule, notably the United States.…”

“…The incentive to exploit the common pool is stronger if districts are smaller. In the non-cooperative bargaining setting of Baron and Ferejohn (1989) model, districts constituting the majority coalition receive a larger share of spending. If districts are unequal in size but are equally represented (like states in the U.S. Senate), smaller districts are more likely to be part of the majority (Persson and Tabellini, 2000, p. 165).…”

The effects of partisan alignment on the allocation of intergovernmental transfers. Differences-in-differences estimates for Spain

“…But we need to rely on coalition theory to answer which of the other two types is more able to obtain funds. Some papers suggest that a coalition leader or formateur (i.e., the party charged with the task of forming the coalition) is able to secure a larger share of benefits than other coalition members (Baron and Ferejohn, 1989). However, other papers suggest that the ability to obtain benefits for the party will be greater when it can pivot between alternative, minimum-winning coalitions (Schofield, 1976, This clearly means that strong coalition partners will receive more grants than weak ones.…”

Blame-Game Politics in a Coalition Government

“…As a result, if the reform is not implemented today, it will not be implemented tomorrow. 8 See Rogoff and Sibert (1988), Rogoff (1990), Coate and Morris (1995), Holmstrom and Ricart I Costa (1986), Prendergast and Stole (1996), Morris (2001) and Scharfstein and Stein (1990). 9 See Aghion and Bolton (1990), Milesi-Ferretti and Spolaore (1994) and Besley and Coate (1998).…”

“…This is motivated by the fact that we consider stable governments (see Laver and Schofield (1998) for evidence on the lower stability of minority governments). 22 The other procedure commonly found in the literature on coalition formation is the probabilistic one due to Baron and Ferejohn (1989), where each party is appointed as the formateur with a probability proportional to its vote share (for an application of this procedure see for example Baron and Diermeier (2001)). There is a debate on which of those rules is empirically relevant.…”