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BPP Field Exam 2006 Answers (view source)
Revision as of 19:46, 20 February 2011
, 19:46, 20 February 2011no edit summary
Application of Baron & Ferejohn (1989) - [http://www.edegan.com/wiki/index.php/Baron_Ferejohn_%281989%29_-_Bargaining_In_Legislatures#Closed_Rule_-_Two_Sessions Close Rule, Finite Session (e.g. n=2)]
Backwards induction yields a SPNE in which each member, if recognized, makes the same majoritarian proposal to distribute the benefits to a minimal winning majority (characterized in Proposition 1).
'''b.) Suppose that the partnership (membership) is stable, infinitely-lived, and makes a surplus allocation decision every year. How would you account for this in your model? Discuss equilibrium behavior and strategies using these assumptions (again you do not need to explicitly solve the model, simply explain your reasoning).'''
