Working Paper: NBER ID: w20011
Authors: S. Nageeb Ali; B. Douglas Bernheim; Xiaochen Fan
Abstract: This paper examines the relationship between the concentration of political power in legislative bargaining and the predictability of the process governing the recognition of legislators. Our main result establishes that, for a broad class of legislative bargaining games, if the recognition procedure permits the legislators to rule out some minimum number of proposers one round in advance, then irrespective of how patient the individual legislators are, Markovian equilibria necessarily deliver all economic surplus to the first proposer. We also examine the extent to which alternative bargaining protocols can limit the concentration of power.
Keywords: Legislative Bargaining; Political Power; Predictability
JEL Codes: D72; D78
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Predictability of the recognition process (D80) | Distribution of economic surplus in legislative bargaining (D72) |
| Recognition process allows legislators to rule out proposers (D72) | First proposer captures all economic surplus in every equilibrium (D51) |
| First proposer captures all economic surplus in every equilibrium (D51) | Concentration of power with the first proposer (D79) |
| Predictability of the recognition process (D80) | Power dynamics in legislative bargaining (D72) |