eprintid: 35195
rev_number: 11
eprint_status: archive
userid: 3730
dir: disk0/00/03/51/95
datestamp: 2024-07-27 08:41:51
lastmod: 2024-08-15 08:07:05
status_changed: 2024-07-27 08:41:51
type: workingPaper
succeeds: 31117
metadata_visibility: show
creators_name: Piazolo, David
creators_name: Vanberg, Christoph
title: Legislative bargaining with private information: A comparison of majority and unanimity rule
subjects: ddc-330
divisions: i-181000
keywords: Bargaining; voting; unanimity rule; majority rule; private information; signaling
abstract: We present a three-person, two-period bargaining game with private information. A single proposer is seeking to secure agreement to a proposal under either majority or unanimity rule. If the first period proposal fails, the game ends immediately with an exogenously given “breakdown” probability. Two responders have privately known disagreement payoffs. We characterize Bayesian equilibria in stagewise undominated strategies. Our central result is that responders have a signaling incentive to vote “no” on the first proposal under unanimity rule, whereas no such incentive exists under majority rule. The reason is that being perceived as a “high breakdown value type” is advantageous under unanimity rule, but disadvantageous under majority rule. As a consequence, responders are “more expensive” under unanimity rule and disagreement is more likely. These results confirm intuitions that have been stated informally before and in addition yield deeper insights into the underlying incentives and what they imply for optimal behavior in bargaining with private information.
date: 2024-07
id_scheme: DOI
id_number: 10.11588/heidok.00035195
schriftenreihe_cluster_id: sr-3
schriftenreihe_order: 0753
ppn_swb: 1898229317
own_urn: urn:nbn:de:bsz:16-heidok-351956
language: eng
bibsort: PIAZOLODAVLEGISLATIV202407
full_text_status: public
series: Discussion Paper Series / University of Heidelberg, Department of Economics
volume: 0753
place_of_pub: Heidelberg
pages: 52
edition: Zweite Auflage
citation:   Piazolo, David ; Vanberg, Christoph  (2024) Legislative bargaining with private information: A comparison of majority and unanimity rule.  [Working paper]     
document_url: https://archiv.ub.uni-heidelberg.de/volltextserver/35195/13/Piazolo_Vanberg_2024_dp753.pdf