Divided government and dominance solvability
Using the spatial theory of voting, this paper describes an institutional structure where there are two branches of the government: the executive, elected by plurality rule, and the legislative elected by proportional rule. The resulting policy outcome is described through a compromise between these two branches. The parties announce their position on a policy issue and then voters vote. We prove the uniqueness of Nash equilibrium in the subgame, where the election of the president is known. Moreover, this equilibrium can be obtained by the process of iterated elimination of dominated strategies. We then solve the whole game by backward induction. Furthermore, the policy outcome at equilibrium of the two-stage game is the same of the simultaneous game, where voters simultaneously choose the two branches. The results suggest a moderate behavior of the voters, basically due to the will to balance the policy outcome.
|Date of creation:||01 Dec 1999|
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- Elhanan Helpman & Gene M. Grossman, 1999.
"Competing for Endorsements,"
American Economic Review,
American Economic Association, vol. 89(3), pages 501-524, June.
- Grossman, G.M. & Helpman, E., 1998. "Competing for Endorsements," Papers 09-98, Tel Aviv.
- Grossman, G-M & Helpman, E, 1996. "Competing for Endorsements," Papers 182, Princeton, Woodrow Wilson School - Public and International Affairs.
- Gene M. Grossman & Elhanan Helpman, 1996. "Competing for Endorsements," Harvard Institute of Economic Research Working Papers 1784, Harvard - Institute of Economic Research.
- Grossman, Gene & Helpman, Elhanan, 1996. "Competing for Endorsements," CEPR Discussion Papers 1546, C.E.P.R. Discussion Papers.
- DE SINOPOLI, Francesco, 1998. "Two results about generic non cooperative voting games with plurality rule," CORE Discussion Papers 1998034, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Alesina, Alberto & Rosenthal, Howard, 1996. "A Theory of Divided Government," Econometrica, Econometric Society, vol. 64(6), pages 1311-41, November.
- Mertens, J.-F., 1988. "Stable equilibria - a reformulation," CORE Discussion Papers 1988038, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Alesina, Alberto & Rosenthal, Howard, 2000. "Polarized platforms and moderate policies with checks and balances," Journal of Public Economics, Elsevier, vol. 75(1), pages 1-20, January.
- Wittman, Donald, 1977. "Candidates with policy preferences: A dynamic model," Journal of Economic Theory, Elsevier, vol. 14(1), pages 180-189, February.
- Francesco De Sinopoli, 2000. "Sophisticated voting and equilibrium refinements under plurality rule," Social Choice and Welfare, Springer, vol. 17(4), pages 655-672.
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