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Bargaining in Legislatures: A New Donation Paradox

In: Advances in Collective Decision Making

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  • Maria Montero

    (University of Nottingham)

Abstract

It is well known that being the proposer or agenda setter is advantageous in many collective decision-making situations. In the canonical model of distributive bargaining (Baron and Ferejohn, 1989), proposers are certain of being part of the coalition that forms, and, conditional on being in the coalition, a player receives more as a proposer than as a coalition partner. In this paper, I show that it is possible for a party to donate part of its proposing probability to another party and be better off as a result. This appears paradoxical, even more so since the recipient never includes the donor in its proposals. The example shows that, even though actually being selected to propose is always valuable ex post, having a higher probability of being proposer may be harmful.

Suggested Citation

  • Maria Montero, 2023. "Bargaining in Legislatures: A New Donation Paradox," Studies in Choice and Welfare, in: Sascha Kurz & Nicola Maaser & Alexander Mayer (ed.), Advances in Collective Decision Making, pages 159-171, Springer.
    • Handle: RePEc:spr:stcchp:978-3-031-21696-1_10
    DOI: 10.1007/978-3-031-21696-1_10
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    References listed on IDEAS

    as
    1. Montero, Maria, 2002. "Non-cooperative bargaining in apex games and the kernel," Games and Economic Behavior, Elsevier, vol. 41(2), pages 309-321, November.
    2. Baron, David P. & Ferejohn, John A., 1989. "Bargaining in Legislatures," American Political Science Review, Cambridge University Press, vol. 83(4), pages 1181-1206, December.
    3. Tasos Kalandrakis, 2006. "Proposal Rights and Political Power," American Journal of Political Science, John Wiley & Sons, vol. 50(2), pages 441-448, April.
    4. Eraslan, Hülya & McLennan, Andrew, 2013. "Uniqueness of stationary equilibrium payoffs in coalitional bargaining," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2195-2222.
    5. Dan S. Felsenthal & Moshé Machover, 1998. "The Measurement of Voting Power," Books, Edward Elgar Publishing, number 1489.
    6. Harrington, Joseph E, Jr, 1990. "The Power of the Proposal Maker in a Model of Endogenous Agenda Formation," Public Choice, Springer, vol. 64(1), pages 1-20, January.
    7. Okada, Akira, 1996. "A Noncooperative Coalitional Bargaining Game with Random Proposers," Games and Economic Behavior, Elsevier, vol. 16(1), pages 97-108, September.
    8. Joseph Kadane & Christopher Stone & Garrick Wallstrom, 1999. "The Donation Paradox for Peremptory Challenges," Theory and Decision, Springer, vol. 47(2), pages 139-155, October.
    9. Eraslan, Hulya, 2002. "Uniqueness of Stationary Equilibrium Payoffs in the Baron-Ferejohn Model," Journal of Economic Theory, Elsevier, vol. 103(1), pages 11-30, March.
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    Cited by:

    1. Eraslan, Hülya & McLennan, Andrew, 2013. "Uniqueness of stationary equilibrium payoffs in coalitional bargaining," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2195-2222.

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    More about this item

    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

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