Demand Commitment in Legislative Bargaining
Morelli (1999) provides a model of government formation in which the parties make payoff demands and the order of moves is chosen by the leading party. Morelli's main proposition states that the ex post distribution of payoffs inside the coalition that forms is proportional to the distribution of relative ex ante bargaining power. We provide a counterexample in which the leading party is able to obtain the entire payoff; furthermore, there are coalitions for which proportional payoff division does not occur for any order of moves.
c1 Maria Montero is University lecturer in the School of Economics, University of Nottingham. University Park, Nottingham NG7 2RD, United Kingdom (firstname.lastname@example.org).
c2 Juan J. Vidal-Puga is Associate Professor in the Research Group of Economic Analysis (RGEA) and in the Department of Statistics and Operations Research, University of Vigo. Facultad de Ciencias Sociales, Campus A Xunqueira, 36005 Pontevedra, Spain (email@example.com).