Difference between revisions of "Baron, D. (1991), Bargaining Majoritarian Incentives, Pork Barrel Programs and Procedural Control"
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Programs are characterized by B, T (total benefits and total taxes). P (programs) are characterized by <math>B/T, P\in[0,\inf]</math>. | 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>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>. | * 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>. | * 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. | * Payoffs are discounted: <math>\delta^{\tau}z_{i}=U_{i}(z,\tau)</math>. Extensive form is the same as before for closed rule. | ||
| + | |||
| + | 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. | ||
Revision as of 18:21, 16 September 2011
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}\gt 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.
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.
