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Rhetoric in legislative bargaining with asymmetric information

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    (Department of Economics, Arizona State University)

  • ,

    (Department of Economics, Johns Hopkins University)

Abstract

We analyze a three-player legislative bargaining game over an ideological and a distributive decision. Legislators are privately informed about their ideological intensities, i.e., the weight placed on the ideological decision relative to the weight placed on the distributive decision. Communication takes place before a proposal is offered and majority rule voting determines the outcome. We show that it is not possible for all legislators to communicate informatively. In particular, the legislator who is ideologically more distant from the proposer cannot communicate informatively, but the closer legislator may communicate whether he would ``compromise" or ``fight" on ideology. Surprisingly, the proposer may be worse off when bargaining with two legislators (under majority rule) than with one (who has veto power), because competition between the legislators may result in less information conveyed in equilibrium. Despite separable preferences, the proposer is always better off making proposals for the two dimensions together.

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  • , & ,, 2014. "Rhetoric in legislative bargaining with asymmetric information," Theoretical Economics, Econometric Society, vol. 9(2), May.
    • Handle: RePEc:the:publsh:821
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    Cited by:

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    3. Ying Chen & Hülya Eraslan, 2017. "Dynamic Agenda Setting," American Economic Journal: Microeconomics, American Economic Association, vol. 9(2), pages 1-32, May.
    4. Harstad, Bård, 2023. "Pledge-and-review bargaining," Journal of Economic Theory, Elsevier, vol. 207(C).
    5. Vincent Anesi & Mikhail Safronov, 2023. "Deciding When To Decide: Collective Deliberation And Obstruction," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 64(2), pages 757-781, May.
    6. Piazolo, David & Vanberg, Christoph, 2022. "Legislative bargaining with private information: A comparison of majority and unanimity rule," Working Papers 0709, University of Heidelberg, Department of Economics.
    7. Harstad, Bård, 2021. "A Theory of Pledge-and-Review Bargaining," Memorandum 5/2022, Oslo University, Department of Economics, revised 21 Jun 2021.
    8. Vincent Anesi, 2018. "Dynamic Legislative Policy Making under Adverse Selection," Discussion Papers 2018-08, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    9. Ying Chen & Hülya Eraslan, 2013. "Informational loss in bundled bargaining," Journal of Theoretical Politics, , vol. 25(3), pages 338-362, July.
    10. Agranov, Marina & Tergiman, Chloe, 2014. "Communication in multilateral bargaining," Journal of Public Economics, Elsevier, vol. 118(C), pages 75-85.
    11. Miettinen, Topi & Vanberg, Christoph, 2020. "Commitment and Conflict in Multilateral Bargaining," Working Papers 0679, University of Heidelberg, Department of Economics.
    12. Louis-Sidois, Charles & Musolff, Leon Andreas, 0. "Buying voters with uncertain instrumental preferences," Theoretical Economics, Econometric Society.
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    15. Chen, Ying & Zápal, Jan, 2022. "Sequential vote buying," Journal of Economic Theory, Elsevier, vol. 205(C).
    16. Baerg, Nicole Rae & Krainin, Colin, 2022. "Divided committees and strategic vagueness," European Journal of Political Economy, Elsevier, vol. 74(C).

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    More about this item

    Keywords

    Legislative bargaining; rhetoric; cheap talk; private information; bundling;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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