The Political Hare and the Stag Hunt

47 Pages Posted: 17 Aug 2024

See all articles by Yaroslav Rosokha

Yaroslav Rosokha

Purdue University - Krannert School of Management

Xinxin Lyu

Purdue University - Department of Economics

Denis Tverskoi

DySoC/NIMBioS

Sergey Gavrilets

University of Tennessee, Knoxville

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Abstract

We theoretically and experimentally study an indefinite dynamic game intended to capture two main aspects of the political process -- elections in which opposing factions compete by spending resources and policy-making in which those same factions are required to cooperate for the successful legislature. The main theoretical result is that limits on spending in the election contest increase cooperation. On the experimental side, we first test and confirm theoretical predictions and then explore whether such limits could arise endogenously. We find that a majority of subjects are successful in establishing a consensus on low limits, leading to higher cooperation and welfare.

Keywords: Political Economy, Dynamic Games, Cooperation, Endogenous Institutions, Experiments

Suggested Citation

Rosokha, Yaroslav and Lyu, Xinxin and Tverskoi, Denis and Gavrilets, Sergey, The Political Hare and the Stag Hunt. Available at SSRN: https://ssrn.com/abstract=4928720

Yaroslav Rosokha (Contact Author)

Purdue University - Krannert School of Management ( email )

1310 Krannert Building
West Lafayette, IN 47907-1310
United States

Xinxin Lyu

Purdue University - Department of Economics ( email )

West Lafayette, IN 47907-1310
United States

Denis Tverskoi

DySoC/NIMBioS ( email )

Knoxville, TN 37996
United States

Sergey Gavrilets

University of Tennessee, Knoxville ( email )

Department of Ecology and Evolutionary Biology
Knoxville, TN 37996
United States

HOME PAGE: http://volweb2.utk.edu/~gavrila/

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