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Political Mergers as Coalition Formation

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  • Eric Weese

    () (Department of Economics, Yale University)

Abstract

Political coalition formation games can describe the formation and dissolution of nations, as well as the creation of coalition governments, the establishment of political parties, and other similar phenomena. These games have been studied from a theoretical perspective, but the resulting models have not been used extensively in empirical work. This paper presents a method of estimating political coalition formation models with many-player coalitions, and then illustrates this method by estimating structural coefficients that describe the behaviour of municipalities during a recent set of municipal mergers in Japan. The method enables counterfactual analysis, which in the Japanese case shows that the national government could increase welfare via a counter-intuitive policy involving transfers to richer municipalities conditional on their participation in a merger.

Suggested Citation

  • Eric Weese, 2011. "Political Mergers as Coalition Formation," Working Papers 997, Economic Growth Center, Yale University.
  • Handle: RePEc:egc:wpaper:997
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    File URL: http://www.econ.yale.edu/growth_pdf/cdp997.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Kuninori Nakagawa, 2014. "Municipal sizes and municipal restructuring in Japan," ERSA conference papers ersa14p416, European Regional Science Association.
    2. repec:oup:jecgeo:v:17:y:2017:i:2:p:435-463. is not listed on IDEAS
    3. repec:elg:eechap:14307_1 is not listed on IDEAS
    4. Enrico Spolaore, 2016. "The economics of political borders," Chapters,in: Economic Analysis of International Law, chapter 1, pages 11-43 Edward Elgar Publishing.
    5. Saarimaa, Tuukka & Tukiainen, Janne, 2012. "Politics in coalition formation of local governments," LSE Research Online Documents on Economics 58528, London School of Economics and Political Science, LSE Library.
    6. Daron Acemoglu, 2010. "Theory, General Equilibrium, and Political Economy in Development Economics," Journal of Economic Perspectives, American Economic Association, vol. 24(3), pages 17-32, Summer.
    7. Ronny Freier & Benjamin Bruns & Abel Schumann, 2015. "Finding your right (or left) partner to merge," ERSA conference papers ersa15p188, European Regional Science Association.
    8. Edoardo Di Porto & Angela Parenti & Sonia Paty & Zineb Abidi, 2017. "Local government cooperation at work: a control function approach," Journal of Economic Geography, Oxford University Press, vol. 17(2), pages 435-463.
    9. Edoardo Di Porto & Vincent Merlin & Sonia Paty, 2013. "Cooperation among local governments to deliver public services: a "structural" bivariate response model with fixed effects and endogenous covariate," Post-Print halshs-00861226, HAL.
    10. Takeshi Miyazaki, 2014. "Municipal consolidation and local government behavior: evidence from Japanese voting data on merger referenda," Economics of Governance, Springer, vol. 15(4), pages 387-410, November.
    11. Jeremy T. Fox & David H. Hsu & Chenyu Yang, 2012. "Unobserved Heterogeneity in Matching Games with an Application to Venture Capital," NBER Working Papers 18168, National Bureau of Economic Research, Inc.
    12. Miyazaki, Takeshi, 2013. "Municipal Consolidation and Local Government Behavior: Evidence from Japanese Voting Data on Merger Referenda," Discussion Paper Series 588, Institute of Economic Research, Hitotsubashi University.
    13. Blesse, Sebastian & Baskaran, Thushyanthan, 2016. "Do municipal mergers reduce costs? Evidence from a German federal state," Regional Science and Urban Economics, Elsevier, vol. 59(C), pages 54-74.
    14. Tukiainen, Janne & Saarimaa, Tuukka & Hyytinen, Ari, 2013. "Seat competitiveness and redistricting: Evidence from voting on municipal mergers," Working Papers 38, VATT Institute for Economic Research.
    15. Kuninori Nakagawa, 2016. "Municipal sizes and municipal restructuring in Japan," Letters in Spatial and Resource Sciences, Springer, vol. 9(1), pages 27-41, March.

    More about this item

    Keywords

    computational techniques; coalitions; municipalities;

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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