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On the optimality of bargaining outcomes in the Collective-Particularistic multilateral bargaining game

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This note analyzes the efficiency properties of the equilibrium in a multilateral bargaining game in which a legislature divides a budget among collective and particularistic goods. We extend the model of Volden and Wiseman (2007) by considering smooth utility functions and consensus requirements ranging from simple-majority to unanimity. We show that when the private valuation of the private good is relatively high, only unanimity induces an (ex-ante) Pareto efficient outcome. Moreover, optimality can be easily attained by using sequential negotiations, independently of the majority requirement.

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  • Daniel Cardona & Antoni Rubí-Barceló, 2013. "On the optimality of bargaining outcomes in the Collective-Particularistic multilateral bargaining game," DEA Working Papers 53, Universitat de les Illes Balears, Departament d'Economía Aplicada.
    • Handle: RePEc:ubi:deawps:53
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    1. Volden, Craig & Wiseman, Alan E., 2007. "Bargaining in Legislatures over Particularistic and Collective Goods," American Political Science Review, Cambridge University Press, vol. 101(1), pages 79-92, February.
    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. David P. Baron & Daniel Diermeier, 2001. "Elections, Governments, and Parliaments in Proportional Representation Systems," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(3), pages 933-967.
    4. Jackson, Matthew O. & Moselle, Boaz, 2002. "Coalition and Party Formation in a Legislative Voting Game," Journal of Economic Theory, Elsevier, vol. 103(1), pages 49-87, March.
    5. Banks, Jeffrey s. & Duggan, John, 2000. "A Bargaining Model of Collective Choice," American Political Science Review, Cambridge University Press, vol. 94(1), pages 73-88, March.
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    Cited by:

    1. Rhode, Paul W. & Snyder, Jr., James M. & Strumpf, Koleman, 2018. "The arsenal of democracy: Production and politics during WWII," Journal of Public Economics, Elsevier, vol. 166(C), pages 145-161.

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    More about this item

    Keywords

    Non-cooperative bargaining; sequential negotiantion; voting; quota rules;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • 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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