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Proto-coalition bargaining and the core

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  • Yves Breitmoser

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Abstract

In the proto-coalition model of government formation, formateur F appoints a proto-coalition and asks its members whether to start negotiating a coalition contract. If all accept, then the proto-coalition forms and starts negotiating; otherwise, a caretaker government assumes office. I extend this model by allowing F to revise the chosen proto-coalition after rejections, that he states pre-conditions for the subsequent negotiations, and that F’s opponents may publicly pre-commit to accept/reject certain proposals. The set of equilibrium outcomes is identified as the core if F’s opponents can pre-commit and as the convex hull of the core if they cannot pre-commit credibly. This extended model eliminates two flaws of the standard model: it explains why F cannot always install his favored coalition (whatever the status quo) and why “important” coalition members may have more bargaining power in the subsequent negotiations than others. Copyright Springer-Verlag 2012

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Bibliographic Info

Article provided by Springer in its journal Economic Theory.

Volume (Year): 51 (2012)
Issue (Month): 3 (November)
Pages: 581-599

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Handle: RePEc:spr:joecth:v:51:y:2012:i:3:p:581-599

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Keywords: Coalition formation; Non-cooperative bargaining; Core; C72; C78; D72;

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Cited by:
  1. Breitmoser, Yves, 2011. "Binomial menu auctions in government formation," MPRA Paper 28576, University Library of Munich, Germany.

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