Edit Article: Baron, D. (1991), Bargaining Majoritarian Incentives, Pork Barrel Programs and Procedural Control

Free text:

[http://www.edegan.com/wiki/images/3/3f/Baron_%281991%29_-_Bargaining_Majoritarian_Incentives_Pork_Barrel_Programs_and_Procedural_Control.pdf Full-text PDF] Note similarity to Baron and Ferejohn (1989): * Multi-lateral, * Bargaining * Divide the "pie" (not the dollar) * Non-cooperative * Use of stationary equilibrium * Divisibility and transferability of benefits. Looks at cases where B<T (benefits less than costs). Programs are characterized by B, T (total benefits and total taxes). P (programs) are characterized by <math>B/T, P\in[0,\inf]</math>. * <math>B: \{b|b_{i}>0, i=1,2,3,...,n, \sum b_{i}\leq B\}</math> * T is always distributed equally among n districts so <math>t_{i}=T/n</math>. * Proposals are fully characterized by <math>b\in B</math> and net benefits are <math>z_{i}=b_{i}-T/n</math>. * Payoffs are discounted: <math>\delta^{\tau}z_{i}=U_{i}(z,\tau)</math>. Extensive form is the same as before for closed rule. Structure of game: * P is drawn (which implies a ratio of B/T). * A random legislator is chosen to distribute B. Note that per the above, all T are distributed equally no matter what. * Legislators vote against the status quo, in which everyone gets nothing and is taxed nothing. Stationarity implies members are paid their continuation value in equilibrium in exchange for their votes. <math>\delta v(g,t), \forall t\in\Tau</math> Proposition 1: With closed rule the stationary EQM has the following properties: * (i) Inefficient pork barrel programs will be adopted. Inefficiency is increasing in <math>n</math> * (ii) Possible set of programs is increasing in <math>\delta</math>. * (iiii) coalitions are minimum winning. * (iv) There is proposal power. * (v) 1st proposal is always selected. Derivation of proposition 1: * <math>z_{i}>\delta\bar{V}</math>. <math> b_{i}-T/n\geq\bar{V} \implies b_{i}\geq T/n+\delta\bar{V}</math>. * Proposal will be accepted if <math>(n-1)/2</math> members vote yes, therefore proposals will be of the form of: Keep <math>B-\frac{n-1}{2}(\frac{T}{n+\delta\bar{V}}</math>. Give <math>T/n +\delta\bar{V}</math> to <math>(n-1)/2</math> others, and the rest zero. * <math>\bar{V}=P(selected)E[Value of being selected|p^{\ast})+P(not selected)(value of not being selected)</math>. * <math>\bar{V}=\frac{1}{n}(B-\frac{n-1}{2}(T/n+\delta\bar{V}))+\frac{n-1}{n}(\frac{1}{2}(T/n+\delta\bar{V}) +\frac{1}{2}(-T/n))</math>. Solve for <math>\bar{V}=\frac{B-T}{n}</math>. * Offer is <math>T/n+\frac{\delta(B-T)}{n}=\frac{\delta B-(1-\delta)T}{n}</math>. ... unfinished. Sorry. Open rule: * Never get universalism w/ inefficient program. * Inefficent program minimum winning coalition (MWC). * Amendments shift power to voters with inefficiency. * Set of proposals which are adopted is smaller.

Summary:

This is a minor edit Watch this page

Cancel