Simple Markovian equilibria in dynamic spatial legislative bargaining

0525430 - NHU-C 2021 RIV NL eng J - Článek v odborném periodiku
Zápal, Jan
Simple Markovian equilibria in dynamic spatial legislative bargaining.
European Journal of Political Economy. Roč. 63, June (2020), č. článku 101816. ISSN 0176-2680. E-ISSN 1873-5703
Institucionální podpora: Progres-Q24
Klíčová slova: endogenous status-quo * dynamic bargaining * legislative bargaining
Obor OECD: Economic Theory
Impakt faktor: 2.366, rok: 2020
Způsob publikování: Omezený přístup
https://doi.org/10.1016/j.ejpoleco.2019.101816

The paper proves, by construction, the existence of Markovian equilibria in a dynamic spatial legislative bargaining model. Players bargain over policies in an infinite horizon. In each period, a sequential protocol of proposal-making and voting, with random proposer recognitions and a simple majority, produces a policy that becomes the next period's status-quo, the status-quo is endogenous. The construction relies on simple strategies determined by strategic bliss points computed by the algorithm we provide. A strategic bliss point, the dynamic utility ideal, is a moderate policy relative to a bliss point, the static utility ideal. Moderation is strategic and germane to the dynamic environment, players moderate in order to constrain the future proposals of opponents. Moderation is a strategic substitute, when a player's opponents do moderate, she does not, and when they do not moderate, she does. We provide conditions under which the simple strategies induced by the strategic bliss points computed by the algorithm deliver a Stationary Markov Perfect equilibrium, and we prove its existence in generic games with impatient players and in symmetric games. Because the algorithm constructs all equilibria in simple strategies, we provide their general characterization, and we show their generic uniqueness.
Trvalý link: http://hdl.handle.net/11104/0309575