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Flexible Integration as an Efficient Decision-Making Rule

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  • Widgrén, Mika

Abstract

In this paper we combine a non-cooperative decision-making game in a federal structure with two levels of interest and an incomplete contract which sets the rules of the game. The question we pose is how to combine ex ante efficiency of the design with ex post efficiency of the outcomes in the decision-making game. The paper shows that in common policies there are no designs that lead to both types of efficiency but flexible integration is a way to achieve both.

Suggested Citation

  • Widgrén, Mika, 1999. "Flexible Integration as an Efficient Decision-Making Rule," CEPR Discussion Papers 2207, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:2207
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    References listed on IDEAS

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    Cited by:

    1. Casella, A., 2000. "Games for Central Bankers, Markets v/s Politics in Public Policy Decisions," G.R.E.Q.A.M. 00a02, Universite Aix-Marseille III.

    More about this item

    Keywords

    Incomplete Contracts; Integration; Legislative Bargaining; Non-Cooperative Games;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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