Journal of Theoretical Politics

An agent competing for resources from a principal may benefit from having the principal believe that the agent shares his preferences, whereas the principal may prefer that agents reveal their types, inducing a separating equilibrium. Such incentives are explored in a model with a principal who sets a budget in two separate periods, and two different agents allocate that budget among services. In the second period, the principal allocates a larger budget to the agent that he believes is more likely to share his preferences. In the first period, each agent may behave strategically, spending more on the service the principal prefers, thereby hiding the agent’s type; this benefits the principal in the current period, but hurts him in the future because he does not know which agent would spend in the way he prefers. The principal may induce separation by giving the agents a large budget in the initial period, or by hiding his preferences from them.

On the basis of a game-theoretic model, this paper argues that governments typically manage crises more effectively in systems where political power is concentrated in a single party, but they are more likely to make investments in future welfare in systems where political power is shared among several parties. The paper makes two contributions. First of all, it shows that both crisis-management failures and investment failures can be explained by a common mechanism: an inter-temporal commitment problem that arises from the inability of political agents to commit to future policy choices. Second, it shows that power-sharing institutions are often associated with more effective government than power-concentration institutions, in contrast to much of the normative literature in comparative politics, in which power-sharing institutions are often justified on other grounds, such as representativeness, responsiveness, or social cohesion. In a world where crises dominate, power-concentration institutions typically perform better; in a world where investment problems dominate, power-sharing institutions typically perform better.

Existing formal models show that remittances generate a resource curse by allowing the government to appropriate its revenues toward rents, rather than public good provision. Households spend their remittance income on public-good substitutes, thereby alleviating the pressure on the government to provide public goods. However, the process by which the government survives the implicit threat of political challengers remains unspecified. By explicitly modeling political competition, I show that there is actually no resource curse from remittances. When there are challengers who can threaten to replace the incumbent leader, the best that any challenger can do is to offer not to take advantage of households’ provision of public-good substitutes, which induces the incumbent to try to match the offer. In equilibrium, public good provision is independent of remittances. This result holds even when no challenger can credibly commit to maintaining her offer once she is in power.

Signature requirements serve as barriers to prevent citizens from overusing initiatives. This study investigates the properties of optimal signature requirements by proposing a model in which the initiative process is a game played among citizens, a campaigner, and a legislature. Under the optimal requirement, the campaigner succeeds in collecting the required signatures only when it creates welfare that exceeds the cost of holding a referendum for the final decision. I specify the condition that such an optimal requirement is achievable. In addition, I perform comparative statics analyses to investigate the validity of the differences in signature requirements among countries and petition types. The results reveal a high optimal requirement when citizens have low variance regarding their opinions or do not consider the campaigned issue important. Finally, I evaluate the suggested reforms in the real world, such as imposing an additional cost on the campaigner to initiate a petition and a ban on paid petitioners, and show that while the former reduces citizen welfare, the latter improves it.

In an economic theory of voting, voters have positive or negative costs of voting in favor of a proposal and positive or negative benefits from an accepted proposal. When votes have equal weight then simultaneous voting mostly has a unique pure strategy Nash equilibrium which is independent of benefits. Voting with respect to (arbitrarily small) costs alone, however, often results in voting against the ‘true majority’ . If voting is sequential as in the roll call votes of the US Senate then, in the unique subgame perfect equilibrium, the ‘true majority’ prevails. It is shown that the result for sequential voting holds also with different weights of voters (shareholders), with multiple necessary majorities (European Union decision-making), or even more general rules. Simultaneous voting in the general model has more differentiated results.