Article

Coalition Formation in Non-Democracies

Review of Economic Studies (Impact Factor: 2.81). 01/2008; 75(4):987-1009. DOI: 10.1111/j.1467-937X.2008.00503.x
Source: RePEc

ABSTRACT We study the formation of a ruling coalition in non-democratic societies where institutions do not enable political commitments. Each individual is endowed with a level of political power. The ruling coalition consists of a subset of the individuals in the society and decides the distribution of resources. A ruling coalition needs to contain enough powerful members to win against any alternative coalition that may challenge it, and it needs to be self-enforcing, in the sense that none of its subcoalitions should be able to secede and become the new ruling coalition. We present both an axiomatic approach that captures these notions and determines a (generically) unique ruling coalition and the analysis of a dynamic game of coalition formation that encompasses these ideas. We establish that the subgame-perfect equilibria of the coalition formation game coincide with the set of ruling coalitions resulting from the axiomatic approach. A key insight of our analysis is that a coalition is made self-enforcing by the failure of its winning subcoalitions to be self-enforcing. This is most simply illustrated by the following example: with "majority rule", two-person coalitions are generically not self-enforcing and consequently, three-person coalitions are self-enforcing (unless one player is disproportionately powerful). We also characterize the structure of ruling coalitions. For example, we determine the conditions under which ruling coalitions are robust to small changes in the distribution of power and when they are fragile. We also show that when the distribution of power across individuals is relatively equal and there is majoritarian voting, only certain sizes of coalitions ("e.g. "with majority rule, coalitions of size 1, 3, 7, 15, etc.) can be the ruling coalition. Copyright © 2008 The Review of Economic Studies Limited.

0 Bookmarks
 · 
131 Views
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: This paper assesses the determinants of state fragility in sub-Saharan Africa using hitherto unexplored variables in the literature. The previously missing dimension of nation building is integrated and the hypothesis of state fragility being a function of rent seeking and/or lobbying by de facto power holders is tested. The resulting interesting finding is that, political interference, rent seeking and lobbying increase the probability of state fragility by mitigating the effectiveness of governance capacity. This relationship (after controlling for a range of economic, institutional and demographic factors) is consistent with a plethora of models and specifications. The validity of the hypothesis is confirmed in a scenario of extreme state fragility. Moreover, the interaction between political interferences and revolutions mitigate the probability of state fragility while the interaction between natural resources and political interferences breeds the probability of extreme state fragility. As a policy implication, there is a ‘sub-Saharan African specificity’ in ‘nation building’ and prevention of conflicts. Blanket fragility oriented policies will be misplaced unless they are contingent on the degree of fragility, since ‘fragile’ and ‘extreme fragile’ countries respond differently to economic, institutional and demographic characteristics of state fragility.
    SSRN Electronic Journal 01/2013;
  • Source
  • Source
    [Show abstract] [Hide abstract]
    ABSTRACT: This paper debunks a common perception that nationalism consolidates the position of ruling elites. Using the economics of identity, I shall prove that nationalism is a double-edged sword by showing that (1) there is a negative relationship between the poor's tendency for revolt and levels of nationalism, which consolidates the rule of the elites (2) an increase in nationalism increases the risk of a military coup, which undermines the rule of the elites. To prove (1), I shall show that an increase in nationalism (among the poor) decreases the amount of taxes required to avert a revolution from the poor. To prove (2), I shall show that an increase in nationalism causes an increase in the elites' level of optimism that the threat level coming from a military coup is low. This results in the implementation of a tax-rate that prevents a revolution but not a military coup, and increases the likelihood of a military take over.
    European Economic Association, Toulouse; 08/2014

Full-text (2 Sources)

Download
48 Downloads
Available from
May 22, 2014