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Bargaining over an endogenous agenda

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Author Info

  • Anesi, Vincent

    ()
    (School of Economics, University of Nottingham)

  • Seidmann, Daniel J.

    ()
    (School of Economics, University of Nottingham)

Abstract

We present a model of bargaining in which a committee searches over the policy space, successively amending the default by voting over proposals. Bargaining ends when proposers are unable or unwilling to amend the existing default, which is then implemented. Our main goal is to study the policies which can be implemented from any initial default in a pure strategy stationary Markov perfect equilibrium for an interesting class of environments including multi-dimensional and infinite policy spaces. It is convenient to start by characterizing the set of immovable policies: which are implemented, once reached as default. These policies form a weakly stable set; and conversely, any weakly stable set is supported by some equilibrium. Using these results, we show that minimum-winning coalitions may not form, and that a player who does not propose may nevertheless earn all of the surplus from agreement. We then consider how equilibrium outcomes change as we vary the order in which players propose, the identity of proposers, and the set of winning coalitions. First, if the policy space is well ordered then the committee implements the ideal policy of the last proposer in a subset of a weakly stable set; but this result does not generalize to other cases. We also show, surprisingly, that a player may prefer not to be given the opportunity to propose; and that the set of immovable policies may shrink as the quota increases. Finally, we derive conditions under which immovable policies in semi-Markovian equilibria form a consistent choice set.

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Bibliographic Info

Article provided by Econometric Society in its journal Theoretical Economics.

Volume (Year): 9 (2014)
Issue (Month): 2 (May)
Pages:

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Handle: RePEc:the:publsh:1318

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Web page: http://econtheory.org

Related research

Keywords: Bargaining; committee voting; evolving default; stable set;

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References

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  1. Vincent Anesi & Daniel J. Seidmann, 2011. "Bargaining over an Endogenous Agenda," Discussion Papers 2011-10, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  2. John Duggan & Tasos Kalandrakis, 2007. "Dynamic Legislative Policy Making," Wallis Working Papers WP45, University of Rochester - Wallis Institute of Political Economy.
  3. Kalandrakis, Anastassios, 2004. "A three-player dynamic majoritarian bargaining game," Journal of Economic Theory, Elsevier, vol. 116(2), pages 294-322, June.
  4. Kevin Roberts, 2007. "Condorcet cycles? A model of intertemporal voting," Social Choice and Welfare, Springer, vol. 29(3), pages 383-404, October.
  5. Vincent Anesi, 2010. "A New Old Solution for Weak Tournaments," Discussion Papers 2010-04, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  6. Battaglini, Marco & Nunnari, Salvatore & Palfrey, Thomas, 2011. "Legislative bargaining and the dynamics of public investment," Discussion Papers, Research Unit: Market Behavior SP II 2011-205, Social Science Research Center Berlin (WZB).
  7. John Duggan & Tasos Kalandrakis, 2011. "A Newton collocation method for solving dynamic bargaining games," Social Choice and Welfare, Springer, vol. 36(3), pages 611-650, April.
  8. Vincent Anesi, 2007. "Noncooperative Foundations of Stable Sets in Voting Games," Discussion Papers 2007-09, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  9. Diermeier, Daniel & Fong, Pohan, 2012. "Characterization of the von Neumann–Morgenstern stable set in a non-cooperative model of dynamic policy-making with a persistent agenda setter," Games and Economic Behavior, Elsevier, vol. 76(1), pages 349-353.
  10. Konstantin Sonin & Georgy Egorov & Daron Acemoglu, 2008. "Dynamics and Stability of Constitutions, Coalitions and Clubs," 2008 Meeting Papers 314, Society for Economic Dynamics.
  11. Vartiainen, Hannu, 2011. "Dynamic coalitional equilibrium," Journal of Economic Theory, Elsevier, vol. 146(2), pages 672-698, March.
  12. Ariel Rubinstein, 2010. "Perfect Equilibrium in a Bargaining Model," Levine's Working Paper Archive 252, David K. Levine.
  13. Philippe Jehiel & Oliver Compte, 2007. "Bargaining and Majority Rules: A Collective Search Perspective," Levine's Bibliography 843644000000000131, UCLA Department of Economics.
  14. Wilson, Robert, 1971. "Stable coalition proposals in majority-rule voting," Journal of Economic Theory, Elsevier, vol. 3(3), pages 254-271, September.
  15. Konishi, Hideo & Ray, Debraj, 2003. "Coalition formation as a dynamic process," Journal of Economic Theory, Elsevier, vol. 110(1), pages 1-41, May.
  16. Hortala-Vallve, Rafael, 2011. "Generous Legislators? A Description of Vote Trading Agreements," International Quarterly Journal of Political Science, now publishers, vol. 6(2), pages 179-196, September.
  17. Wioletta Dziuda & Antoine Loeper, 2010. "Dynamic Collective Choice with Endogenous Status Quo," Discussion Papers 1514, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  18. Larcker, David F. & Ormazabal, Gaizka & Taylor, Daniel J., 2011. "The market reaction to corporate governance regulation," Journal of Financial Economics, Elsevier, vol. 101(2), pages 431-448, August.
  19. Vincent Anesi, 2006. "Committees with Farsighted Voters: A New Interpretation of Stable Sets," Social Choice and Welfare, Springer, vol. 27(3), pages 595-610, December.
  20. Lucas, William F., 1992. "Von Neumann-Morgenstern stable sets," Handbook of Game Theory with Economic Applications, in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 1, chapter 17, pages 543-590 Elsevier.
  21. Tasos Kalandrakis, 2010. "Minimum winning coalitions and endogenous status quo," International Journal of Game Theory, Springer, vol. 39(4), pages 617-643, October.
  22. Vincent Anesi & Daniel J Seidmann, 2012. "Bargaining in Standing Committees," Discussion Papers 2012-09, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  23. Daniel Diermeier & Pohan Fong, 2011. "Legislative Bargaining with Reconsideration," The Quarterly Journal of Economics, Oxford University Press, vol. 126(2), pages 947-985.
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Citations

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Cited by:
  1. Anesi, Vincent & Seidmann, Daniel J., 2014. "Bargaining over an endogenous agenda," Theoretical Economics, Econometric Society, vol. 9(2), May.
  2. Matthias Dahm & Amihai Glazer, 2013. "A Carrot and Stick Approach to Agenda-Setting," Discussion Papers 2013-10, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  3. Vincent Anesi & Daniel J Seidmann, 2012. "Bargaining in Standing Committees," Discussion Papers 2012-09, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.

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