A dynamic theory of parliamentary democracy
Journal
Economic Theory
Journal Volume
49
Journal Issue
3
Pages
703-738
Date Issued
2012
Author(s)
Abstract
This paper presents a dynamic model of elections, government formation, and legislation in a parliamentary democracy with proportional representation in which the policy chosen in one period becomes the status quo for the next period. The electorate votes strategically by taking into account the likely governments that parties would form based on their representation and the policies they would choose as a function of the status quo. The status quo thus affects both the election outcomes and the bargaining power of the parties during government formation. A formateur party therefore has incentives to strategically position the current policy to gain an advantage in both the next election and the subsequent bargaining over government formation and policy choice. These incentives can give rise to centrifugal forces that result in policies that are outside the Pareto set of the parties.
Subjects
Government formation; Inefficiency; Lack of commitment; Parliamentary democracy; Policy dynamics; Proportional representation
SDGs
Type
journal article