In this chapter we put forward a framework for using game theory to study politics. In our view, the rigorous analysis of strategic interactions can make a number of contributions to our collective understanding of political phenomena. Author(s): Adam Meirowitz, Kristopher W. Ramsay Read full article
Asymmetric information can lead to inefficient outcomes in many bargaining contexts. It is sometimes natural to think of asymmetric information as emerging from imperfect observation of previously taken actions (e.g., obtaining compliments or substitutes for the item being bargained over). How do such strategic investment choices prior to bargaining interact with the strategic problem [...]
A voluminous literature seeks to understand which institutions effectively resolve disputes that might otherwise lead to military conflict. The emergence of a dispute is usually taken as the starting point of the analysis so as to ask questions of the sort, given a dispute, how will different institutions such as mediated or unmediated peace [...]
Many borrowers have difficulty repaying their federal student loans, particularly at certain institutions. This paper proposes an institutional accountability system that is intended to help align incentives of institutions with their student loan borrowers and taxpayers. Under the risk-sharing proposal, institutions with poor loan performance reimburse the federal loan program for [...]
Low- and middle-income college borrowers often struggle with economic opportunity and loan burdens after leaving school. However, some institutions, including some non-selective schools, do a good job of providing economic mobility to low-income students. This implies that there is scope for a policy to redirect loan dollars – and therefore students – from low-performing [...]
This paper examines how housing market distress affects job search. Using data from a leading online job search platform during the Great Recession, we find that job seekers in areas with depressed housing markets apply for fewer jobs that require relocation. With their search constrained geographically, job seekers broaden their search to lower level [...]
Despite the large impact institutions have on the allocation of population, it remains an open question which institutions produce an efficient allocation of people across cities. Due to agglomeration, differences in amenities, and congestion, cities experience decreasing returns to population within cities (intensive margin) and across cities (extensive margin). This paper considers three institutional [...]
Austen-Smith and Banks (1996) showed that sincere voting is not typically an equilibrium of the Condorcet voting model when the electorate is large. Here, we reverse their finding by adding to the Condorcet model a third type of voter—one that receives no information in favor of either of the alternatives—as well as global uncertainty about the probability that [...]
Many of the motivating examples and applications of non-cooperative bargaining involve groups bargaining against each other. However, much of the literature ignores the structures of profit sharing within the group. This structure determines the incentives for each player and there by determines the bargaining power of each group. We construct a model in which [...]
We consider an infinitely repeated legislative bargaining game with three players who split a fixed surplus in every period. The status quo allocation evolves endogenously over time, as agents can approve new proposals by simple majority rule. One player is permanently endowed with veto power, and must approve any amendment to the status quo. [...]