Beyond pragmatism: the role of endogenous political platforms in electoral alliances

We present a theory of electoral alliances in which leading parties (heads of the ticket) seek to gain the support of a small party through transfers (e.g., cabinet positions and pork barrel) and ideological proximity (via political platforms). We build a two-stage complete information game in which parties' voter bases can be more or less sensitive to platforms that are distant from their preferred ones. We contribute to the scarce theoretical literature on electoral alliances by making the choice of political platforms endogenous. We find that, in equilibrium, parties whose voters are more ideological offer relatively more transfers as compensation for choosing a platform that is not closely aligned with the small party's bliss point. Our results help understand the pattern of political alliances among some of the largest political parties in Brazil and shed light on one of the potential causes of one of the largest corruption scandals in Brazilian history.