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This paper presents a theoretical model that explains how decision rules and communication jointly affect collective outcomes in a small community under epistemic uncertainty. To see the likelihood of social reform and the probability of sensible decision-making under uncertainty, we compare two types of decision rules: unanimity rule and majority rule with veto. Also, we analyze the role of communication among voters before the voting occurs. We show that there exist equilibria and that once each player’s preference is determined, the equilibrium behavior is specified. In addition, we use simulation methods to examine how the precision of group decision and the voters’ welfare vary.

Do countries learn from their mistakes? Here we consider one example of this question with respect to banking crises using the concept of effective learning, that is, learning plus the ability to implement such learning. Excessive credit growth is widely considered to be the strongest contributor to banking crises. Thus, it is interesting to see whether banking crises are associated with lower rates of credit growth in the future and if so, what are major factors which influence such changes in behavior. In previous research we have found that, on average, banking crises are followed by substantially lower credit growth but this varies considerably across countries. Our hypothesis is that lower rates of future credit growth reflect a process of learning from one’s mistakes and taking corrective actions. This paper offers an investigation of some of the political economy factors that may influence whether crises result in greater discipline. Overall, we found very little average effective learning in stable autocracies and on the contrary, found considerable discipline in stable democracies. Nevertheless, we found even larger discipline effects in countries that transitioned to democracy in the wake of banking crises. Our results regarding the role of veto players and government turnovers are inconclusive.

We study optimal policy experimentation by a committee. We consider a dynamic bargaining game in which committee members choose either a risky reform or a safe alternative each period. When no redistribution is allowed, the unique equilibrium outcome is generically inefficient. When redistribution is allowed (even small amounts), there always exists an equilibrium that supports optimal experimentation for any voting rule without veto players. With veto players, however, optimal policy experimentation is possible only with a sufficient amount of redistribution. We conclude that veto rights are more of an obstacle to optimal policy experimentation than are the constraints on redistribution themselves. (JEL D72, C78, H23, D78, D71)

Why are democracies backsliding? I contend that a large productivity gap between economic groups motivates those with low productivity to capture the state for rent-seeking. They assess their relative position as weak and are willing to sacrifice certain democratic guarantees in exchange for favorable policies. Erosion takes two forms. (1) With high inter-class inequality and a large productivity gap among economic industries, losing economic elites capture the state through a political outsider who enacts favorable policy. Once in office, the outsider expands his personal executive control and attacks key democratic veto players. (2) When inter-class inequality is high but the inter-industry productivity gap is small, a united economic elite coordinate to stop a populist takeover. Traditional political elites respond to the populist threat by curtailing basic freedoms of speech and association. I use both quantitative and case study evidence from the US and Spain to support my main hypotheses.

Political institutions may directly affect the likelihood of currency crises by influencing market confidence. They may indirectly affect the likelihood of currency crises by influencing economic fundamentals. This study uses econometric mediation to estimate both direct and indirect causal pathways for veto player theory—a common framework for analyzing political institutional constraints—and finds this approach improves upon the standard econometric approach in the extant literature, which only estimates the direct causal pathway. This new mediated approach shows that political constraints also indirectly reduce the likelihood of crises through strengthening key economic fundamentals. Additionally, the analysis finds that when global conditions are stable, more constraints are shown to directly reduce the risk of crises. When global conditions are volatile, more constraints are shown to directly increase the risk of crises. Global volatility is more likely to cause crises in countries with relatively constrained political systems, and vice versa.

In many domains, committees bargain over a sequence of policies and a policy remains in effect until a new agreement is reached. In this paper, I argue that, in order to assess the consequences of veto power, it is important to take into account this dynamic aspect. I analyze an infinitely repeated divide-the-dollar game with an endogenous status quo policy. I show that full appropriation by the veto player is the only stable policy when legislators are sufficiently impatient; and that, irrespective of legislators' patience and the initial division of resources, there is always an equilibrium where policy eventually gets arbitrarily close to full appropriation by the veto player. In this equilibrium, increasing legislators' patience or decreasing the veto player's proposal power makes convergence to this outcome slower and the veto player supports reforms that decrease his allocation. The main predictions of the theory find support in controlled laboratory experiments.

We provide a version of the Coase theorem within a general equilibrium framework. We consider an economy with other-regarding preferences, and where rights, licenses, or permissions are required to use, consume or transform some specific commodities. These permissions are initially allocated among consumers and, as the commodities, can be costlessly traded. In this scenario, we define different veto mechanisms and the corresponding core solutions that, naturally, result in the same set of efficient allocations. Our final result sets sufficient conditions on preferences and the requirement of rights to ensure that any equilibrium allocation belongs to the core and, in particular, is efficient.

The era of American leadership in the multilateral trading regime has ended. This paper argues that this current antipathy to trade is unsurprising: support for US leadership of the regime has always rested on a precarious balance among domestic interests. To overcome a historic bias in favor of home market production, American leaders created incentives for exporters to organize while creating roadblocks for import-competing firms and their employees. The dominance of the exporters’ voice had a significant influence on the policies the US pursued in the design and execution of the global trade regime. Most importantly, the absence of labor's voice undermined the prospect for “embedded liberalism” and instead resulted in an anemic system of adjustment for job loss at home and limited support for worker interests within the regime. While policymakers’ decision to shift power away from potential “veto” groups may have been necessary for US leadership of the Liberal International Order, this institutional design undermined a robust response to the economic dislocation thought to be a result of globalization. The result was a fracturing of the coalition in support of American leadership in the GATT/WTO regime.

This paper studies the effect of veto right on players’ income in multi-player dynamic bargaining game. Based on a basic multi-person dynamic bargaining model generalized by the Rubinstein’s two-person alternating-offer bargaining model, the authors construct a dynamic multi-player bargaining game with veto players by adding a constraint to its negotiation process, which is obtained by studying the influence of exercising the veto right exercised by veto players. The authors emphatically describe the strategic game form of this dynamic bargaining game and study its equilibrium, then we analyze the relationship between the minimum acceptable payoff of the veto players and the equilibrium income. The research shows that veto right may increase the benefits of veto players and decrease the benefits of non-veto players. Veto players will not affect the players’ benefits and the form of equilibrium when the minimum acceptable payoff of every veto player is relatively low. When the minimum acceptable payoff of the veto player is high enough, he can only get the minimum acceptable payoff, and his benefit increases as his minimum acceptable payoff increases. In this case, the veto player has intention to obtain more resources by presenting a higher minimum acceptable payoff.

Studies of the line item veto have traditionally focused on whether it leads to less spending than an all-or-nothing veto and have only produced modest results. However, other impacts that differences in rule choice might effectuate have not been investigated in detail. We examine the role of veto rules for budgetary volatility, the extent to which expenditures vary. Theoretically, we model budget choices given all-or-nothing, line item, and item-reduction vetoes and demonstrate that more encompassing veto authority does not necessarily decrease spending but should result in more political gridlock, implying less volatility. We then analyze the model’s prediction by examining American state budget expenditures from 1978 to 2007. Whether one looks at budget categories or total spending, volatility is greater with the all-or-nothing veto relative to more stringent alternatives. Hence, delegating greater authority to executives such as governors, perhaps unexpectedly, likely strengthens expectations about future budgets while reducing the responsiveness of spending to changing preferences or circumstances.

This paper utilizes time-varying parameters Bayesian vector auto-regression model with stochastic volatility approach to investigate the time-varying dynamic relation between FDI, growth and trade partisan conflict in the US. The empirical results confirm that an increase in trade partisan conflict will deter FDI inflows to the US and discourage economic activities. Besides, we also examine the responses of equity investment, intra-company loans and reinvestment earnings given trade partisan conflict shock. In a robustness check, we consider different measurements on FDI and other control variables. The negative role of a trade partisan conflict shock is not altered, indicating the robustness of the findings. Moreover, trade partisan conflicts like GATT, Omnibus Bill Veto, NAFTA, Bush versus Kerry, the financial crisis and TPP are key factors which affect the dynamics. The US government should remedy the negative impacts of trade policy conflict on FDI inflows and economic growth.

We provide a microfoundation for the existence of political business cycles generalizing and extending the classic Nordhaus model. Using a differential games approach, we model the strategic interaction of legislators in an election period and show that cycles can exist in equilibrium. The existence and shape of cycles depend on the parameters of the model and the initial level of unemployment. In addition, we offer an extension of the model to incorporate presidential veto behavior.

There is growing evidence that political economy factors are central to whether or not proposed health financing reforms are adopted, but there is little consensus about which political and institutional factors determine the fate of reform proposals. One set of scholars see the relative strength of interest groups in favour of and opposed to reform as the determining factor. An alternative literature identifies aspects of a country’s political institutions–specifically the number and strength of formal ‘veto gates’ in the political decision-making process—as a key predictor of reform’s prospects. A third group of scholars highlight path dependence and ‘policy feedback’ effects, stressing that the sequence in which health policies are implemented determines the set of feasible reform paths, since successive policy regimes bring into existence patterns of public opinion and interest group mobilization which can lock in the status quo. We examine these theories in the context of Malaysia, a successful health system which has experienced several instances of proposed, but ultimately blocked, health financing reforms. We argue that policy feedback effects on public opinion were the most important factor inhibiting changes to Malaysia’s health financing system. Interest group opposition was a closely related factor; this opposition was particularly powerful because political leaders perceived that it had strong public support. Institutional veto gates, by contrast, played a minimal role in preventing health financing reform in Malaysia. Malaysia’s dramatic early success at achieving near-universal access to public sector healthcare at low cost created public opinion resistant to any change which could threaten the status quo. We conclude by analysing the implications of these dynamics for future attempts at health financing reform in Malaysia.

CESAA 19th ANNUAL EUROPE ESSAY COMPETITION 2011 - Undergraduate winner: Dan Norrie (Monash University)The French government’s rejection of the Blair House Agreement in 1993 enabled France to resist agricultural reform and achieve relative gains over other European Union States. The existence of the Common Agricultural Policy (CAP) allows France to extract the economic surplus of European Union (EU) members through taxes and subsidies, which artificially improve the competitiveness of French agriculture. France took advantage of the EU principle of consensus by adopting a strategy of non-compliance to agricultural negotiations, positioning it to directly influence EU Commission policy. This allowed France to benefit from EU bargaining power in the Uruguay Round, and ensure greater concessions from States driving agricultural reform. The reinstatement of veto power in the EU Community has made future agricultural reform more difficult, allowing France to continue to realise welfare gains at the expense of other EU members. The paper adopts a literature review to analyse French national interest and the costs and benefits of foreign policy strategies.

We propose a five-player common-pool resource (CPR) game with endogenous coalition formation. We show that the level of extraction from the CPR depends on the size of each coalition that is formed and on the final coalition structure. These predictions are tested in a laboratory experiment. We consider two treatments: dictator vs. veto. In the dictator treatment, at each stage of the coalition formation game, a randomly chosen player imposes the coalition size and selected members cannot refuse to become a member. In the veto treatment, players have the right to refuse joining the current coalition if they want to and make counter-proposals. We observe that the formation of the grand coalition is more frequent in the dictator treatment. However, with the repetition of the coalition formation game, the grand coalition becomes more frequent under both treatment, and past experience of a grand coalition increases the likelihood that the current coalition structure is the grand coalition. Finally, the possibility to form coalitions is beneficial at reducing CPR extractions, compared to the singleton structure, in both treatments.

The previous chapters have examined the purpose of budgeting, fiscal conservatism and fiscal conservatives, patterns and trends in revenue and spending, the executive budget model, the annual budget process, performance budgeting, the line-item veto in executive-legislative relations, and the budget priorities and accomplishments of nine modern-era governors. This concluding chapter identifies several milestones in the evolution of the state’s budget process and in the patterns and trends of its taxing and spending. It concludes by placing Georgia’s budget process and its patterns and trends in revenue and spending in comparative perspective.

The purpose of this article is to explain why recent corporate governance reforms and initiatives proclaiming to enhance shareholder participation and elevate shareholder rights, do not go far enough. Indeed, it is suggested that corporate governance polices and reform programs, which have emerged across the world in response to a number of high-profile corporate collapses, act to re-emphasise the limited, 'passive' role which individual shareholders have traditionally experienced in public companies. Although increasing the amount information provided to shareholders about corporate decisions and strategies, and providing shareholders with a greater opportunity to participate in annual general meetings, do go some way in 'empowering' shareholders, it is argued that shareholders essentially remain passive observers, rather than becoming active participants. To become active participants, or corporate governance 'insiders " it is argued that corporate law needs to be directed at piercing the 'decision-making sphere' for individual shareholders in public companies. This involves accommodating an active role for shareholders in the actual decision-making processes of the corporation, rather than simply being informed of decisions that are made and being entitled to veto decisions at the annual general meeting. The second part of the article looks specifically at how the 'oppression' or 'unfair prejudice' remedy, the most commonly used shareholder remedy, is capable - if reformulated so that the pursuit of happiness, rather than vague notions of 'fairness' and 'justice' is the central objective of the remedy - of being used to influence a change of culture within public companies directed at facilitating an active participatory role for shareholders.

The article tackles the problem of the most important institutional determinants of public expenditures. Within the traditions of public choice and institutional economics, it tests several theories ranging from the fiscal commons framework, Political Business/Budget Cycle (PBC) and path dependence to veto players theory. Its novelty compared to previous research stems from an attempt to test several theories simultaneously, dealing with model uncertainty by using sensitivity analysis within the Bayesian Model Averaging framework with a vast prior structure in terms of model, g and multicollinearity dilution priors. The results confirm several hypotheses tested in the area of fiscal management across the recent decades within the group of developed economies, giving especially strong support to the tragedy of the fiscal commons and path dependence concepts, while only partial support to veto players theory. In contrast, explanations based on political budget cycle (PBC) theory are dismissed. Among other interesting findings reported in the study, Scandinavian countries turn out to be the most fiscally responsible when other institutional factors are taken into account. Similarly, contrary to other recent research into the issue of EU fiscal institutional framework, Euro area countries are characterized by limited public expenditures.

Voting by Veto [VBV], developed by Dennis C. Mueller, is a two-stage voting mechanism for committee decision making. In the first stage, every member of the committee makes a proposal. The proposals are joined with the current status quo (or another fallback option). For the second stage, a random mechanism determines the order of voting and the committee members sequentially eliminate one alternative each. After every committee member has exercised her veto, a single winning alternative remains. Game theory predicts that the equality of the resulting distribution under VBV varies with group size. Hence, decisions in two-member groups should result in highly unequal distributions of benefits. With increasing group size, however, VBV should generate more equally distributed outcomes. We examine the effect of group size under VBV in a series of laboratory experiments where groups with a varying number of members play a ‘divide the dollar game’. Our results confirm that larger groups choose more equal distributions than smaller groups. However, we also find deviations from the model's predictions. Some committees in our experiment do not select Pareto-optimal alternatives. An exploratory analysis of possible explanations suggests that individual behavior is most likely motivated by a combination of material self-interest and social preferences such as reciprocity and fairness.

Government responsiveness to citizens’ preferences is considered a sign of a well-functioning representative democracy. While the empirical literature has grown significantly, scholars have given less scrutiny to the conceptualization of government responsiveness and its relationship to policy/ideological congruence. We show that government responsiveness represents dynamic changes from governments in order to improve policy/ideological congruence. In addition, we consider how electoral systems influence governments’ incentives to be responsive as well as their capacity to be responsive. Building on a veto player approach, we argue that government responsiveness decreases as the number of parties in cabinet increases. We examine government responsiveness to citizens’ ideological preferences in 16 advanced democracies in 1980–2016 with respect to social spending. In line with our veto player framework, we show, first, that governments are generally more responsive under majoritarian than PR electoral systems and, second, that government responsiveness decreases under PR electoral systems as the number of parties increases in cabinet.

We revisit the “Coase theorem” through the lens of a cooperative game model which takes into account the assignment of rights among agents involved in a problem of social cost. We consider the case where one polluter interacts with many potential victims. Given an assignment or a mapping of rights, we represent a social cost problem by a cooperative game. A solution consists in a payoff vector. We introduce three properties for a mapping of rights. First, core compatibility indicates that the core of the associated cooperative games is nonempty. Second, Kaldor‐Hicks core compatibility indicates that there is a payoff vector in the core where victims are fully compensated for the damage once the negotiations are completed. Third, no veto power for a victim says that no victim has the power to veto an agreement signed by the rest of the society. We then demonstrate two main results. First, core compatibility is satisfied if and only if the rights are assigned either to the polluter or to the entire set of victims. Second, there is no mapping of rights satisfying Kaldor‐Hicks core compatibility and no veto power for a victim.

We give a notion of bargaining set for finite economies using Aubin’s (1979) veto and show its coincidence with the set of Walrasian allocations, providing a discrete approach to the characterization of competitive equilibria obtained by Mas-Colell (1989) for continuum economies. We also study how the restriction on the formation of coalitions affects the bargaining set. In the last part of the work, using our equivalence result along with some known characterizations of Walrasian allocations, we state additional interpretations of the bargaining set

Many climate change adaptation scholars recognise the complexities in the governance of adaptation. Most have used the concept of ‘barriers to adaptation’ in an attempt to describe why governance of adaptation is challenging. However, these studies have recently been critiqued for over simplifying complex governance processes by referring to the static concept of barriers, thereby ignoring dynamic complexity as a root explanatory cause. This paper builds the argument that how barriers are currently used in the literature is insufficient to explain why the governance of adaptation often proves difficult. We adopt a so-called mechanism-based approach to investigate how and why the governance of ecosystem-based adaptation (EbA) reaches impasses in five cases in Thailand and the Netherlands. Our findings show six causal mechanisms that explain impasses in the five case studies: (1) frame polarisation, (2) timing synchronisation, (3) risk innovation, (4) rules of the game, (5) veto players and (6) lost in translation. Several of these causal mechanisms are recurring and emerge under specific contextual conditions or are activated by other mechanisms. Our findings provide valuable insights into the impasses in the governance of EbA and allow for critical reflections on the analytical value of the mechanism-based approach in explaining why the governance of adaptation proves difficult and how this can be overcome.

In 2014, the BRICS countries established the Contingent Reserve Arrangement (CRA) purportedly to compensate for the BRICS’ frustration over the non-materialization of reforms in the International Monetary Fund (IMF) that had long been promised but blocked by the United States until late 2015. A contractual analysis of the CRA reveals that though all BRICS countries enjoy equality for strategic decisions, the CRA strongly resembles the IMF’s quota-based voting distribution where operational decisions are taken. It nevertheless provides a more balanced voting system, as it does not provide one single party with a veto position. The CRA further lacks legal personality and other fundamental features such as its own staff or macroeconomic research facilities. Financing approvals are thus linked to IMF on-track arrangements, which undermines the CRA’s significance. The CRA nonetheless holds the potential to be developed into a viable BRICS alternative to the IMF in the long term.

In a veto game a biased expert recommends an action that an uninformed decision maker can accept or reject for an outside option. The arrangement is ubiquitous in political institutions, corporations, and consumer markets but has seen limited use in applications due to a poor understanding of the equilibrium set and an ensuing debate over selection. We develop a simple method to construct every veto equilibrium and identify the most informative equilibrium in a setting that spans prior work. We show that Krishna and Morgan's (2001) equilibrium is maximally informative and strengthen Dessein's (2002) comparison of full delegation and veto. In an application we study the relationship between a patient and a doctor with a financial incentive to overtreat, and show that the doctor's bias harms the patient both through excessive treatment and information loss, that the latter can be substantial, and that insurance benefits both parties by improving communication.

In China energy-saving mandates issued by the central government can trigger a trade-off between faithful implementation and kinds of strategic responses at the local level. This paper examines the biased data revision pattern of Chinese provinces under incentives created by energy-saving mandates. The data revisions conducted by provinces in the treatment group are evaluated against those carried out by their counterparts in the control group. Empirical evidence is provided that some provinces in the treatment group conducted biased data revisions by taking advantage of benchmark revisions of historical data following the 2008 Economic Census. These provinces adjusted their base-year energy consumption figure upward in seeking to reach the 2010 energy intensity reduction targets numerically. In institutional terms, strong political incentives are formed by assigning energy-saving indicators a veto power in cadre performance assessment. In a self-reported statistical regime, checks and balances are particularly weak regarding benchmark revisions of historical data. The findings of this paper suggest that the data quality of associated official statistics at the local level is undermined by energy-saving mandates. To improve the data quality of the official statistics, new checks and balances should be installed for local statistics.

Network governance may strike a balance between democratic participation (input-legitimacy) and efficiency and effectiveness (output-legitimacy) of policy processes and thus can enhance the acceptance of policy reforms. This article aims at an appraisal of network governance in Swiss forest policy by uncovering its current structure and by describing the experiences in terms of legitimacy and concerning how this is perceived by the actors involved. Although network governance is common in Switzerland, as an early coordination of stakeholders is required due to strong veto points later in the political process, more progressive participatory procedures have recently been introduced to these networks. Based on expert interviews and a social network analysis derived from an online survey, we confirm that the core of the Swiss forest policy network includes only a handful of actors. These actors are relatively satisfied with the current approach and some of them decline a further strengthening of participatory elements. Particularly the forest economic as well as the actors representing the sub-national jurisdictions (cantons) are well connected with other actors from forest industry, but still they perceive their influence as not being adequate. The environmental NGOs, in contrast, judge their influence more positively, albeit they coordinate mostly with each other and with the national administration. Although the networks do not engage legislative actors very closely at the time of analysis, probably because forest policy reform has already settled the more fundamental questions, the forest policy network nonetheless seems well embedded in the democratic process.

We study unanimous decision making under incomplete information. We argue that all unanimous decision rules are not equivalent. We show that majority rules with veto power are (i) Pareto superior to commonly used unanimous rules, and (ii) ex-ante efficient in a broad class of situations.

How does line-item veto (LIV) power affect a governor’s ability to structure the state budget? Is LIV power only relevant as a partisan tool? Is it still relevant when the state legislature can ove...

Existing literature on China’s Performance Evaluation System and how it shapes cadre behavior tends to assume a hierarchy of work targets either through the framework of soft targets, hard targets, and priority targets with veto power or through target measurability. However, this traditional conceptualization of target hierarchy can no longer capture the nature of content of today’s Performance Evaluation System nor can it explain cadre behavior under the new economic and political order imposed by Xi Jinping. Based on field research conducted in various administrative level localities of four provinces during 2014, 2016, and 2017, I argue that today’s Performance Evaluation System has evolved into an increasingly balanced system driven by three prevailing features: the diminishing hard/soft targets dichotomy, the much more constrained power of priority targets with veto power, and the comprehensive quantification of evaluation targets. This study contributes to an updated understanding of the incentive mechanism of the Performance Evaluation System and how that can help explain cadre behavior today. The findings of the research have important political and economic implications on the Xi administration and the Communist Party.

We provide a notion of bargaining set for a finite production economy based on a two-step veto mechanism a la Aubin (1979). We show that this bargaining set and the set of Walrasian allocations coincide. At the light of our result we refine Mas-Colell’s bargaining set for replicas of a finite economy. Our main result shows the persistence of Anderson et al.’s (1997) non-convergence of the bargaining sets to the set of Walrasian allocations. In addition, we analyze how the restriction on the formation of coalitions affects the bargaining set.

Purpose The purpose of this paper is to explore how the strength of political veto players affects the long-run credibility of economic institutions and how they jointly affect entrepreneurial activity. Design/methodology/approach The authors employ an annual panel covering 30 OECD countries from 1993 to 2011. Findings An error correction model identifies a positive and significant short-run effect on self-employment from large government spending at low levels of veto player strength. A static model conversely indicates that smaller government spending is positively associated with entrepreneurship at lower levels of veto player strength in the long run. Originality/value The authors are the first to explore the interaction of economic and political institutions in the development of entrepreneurship.

We conduct a novel type of multi-person one-shot game that reflects important aspects of collective bargaining. In all treatments a proposer has to divide a pie among herself and two groups of three recipients each. She cannot discriminate within, but across groups. A committee with representatives from one or both groups takes acceptance decisions. In a 2 × 2 design we vary (i) representation in the decision committee (one vs. both groups) and (ii) the decision rule (unanimity vs. majority voting). We find that (i) representation of a group in the committee is crucial for receiving a significant share, (ii) proposals are balanced only if both groups have veto power, (iii) negotiations often fail if the decision environment gives insufficient guidance on what an appropriate proposal is, and (iv) non-binding communication substantially reduces rejection rates and proposer shares.

This article discusses the rise and decline of collective bargaining in the public services in Italy. The emphasis is on the period from the 1990s till the present. The power of the unions only partially appears linked to that of bargaining. In fact the unions were already strong and well settled before the public sector industrial relations were formalized. Yet the unions’ veto power has grown considerably during the years in which negotiating strength has grown. Current data confirm its importance and organizational strength, but the weakening of the bargaining system could in perspective make it more difficult facing new challenges.

What effect do the domestic institutional constraints in target states have on sanction outcomes? Other than the narrow focus on political regime type, little is known about how the institutional makeup of target states might affect leaders’ ability to adjust their policies to defy sanctions. We assert that the size of veto players in targets is a crucial yet overlooked institutional factor in explaining sanction effectiveness. We contend that political leaders subject to the approval of multiple veto players are more likely to concede as they are less likely to develop polices to counter the sanctions. We assess the empirical merits of our theoretical claims by combining data on sanctions from the Threat and Imposition of Economic Sanctions data set with the veto points data from the Political Constraints data set. Results from the data analysis for the 1946 to 2005 period indicate that the size of veto players is a significant predictor of sanction success even when we control for political regime type and other major political and economic covariates of sanction effectiveness.

Shared ownership of property and resources is a longstanding challenge throughout history that has been amplifying with the increasing development of industrial and postindustrial societies. Where governments, project planners, and commercial developers seek to develop new infrastructure, industrial projects, and various other land-and resource-intensive tasks, veto power shared by various local stakeholders can complicate or halt progress. Risk communication has been used as an attempt to address stakeholder concerns in these contexts, but has demonstrated shortcomings. These coordination failures between project planners and stakeholders can be described as a specific kind of social dilemma that we describe as the “tragedy of the anticommons.” To overcome such dilemmas, we demonstrate how a two-step process can directly address public mistrust of project planners and public perceptions of limited decision-making authority. This approach is examined via two separate empirical field experiments in Portugal and Tunisia, where public resistance and anticommons problems threatened to derail emerging industrial projects. In both applications, an intervention is undertaken to address initial public resistance to such projects, where specific public stakeholders and project sponsors collectively engaged in a hypothesis-testing process to identify and assess human and environmental health risks associated with proposed industrial facilities. These field experiments indicate that a rigorous attempt to address public mistrust and perceptions of power imbalances and change the pay-off structure of the given dilemma may help overcome such anticommons problems in specific cases, and may potentially generate enthusiasm and support for such projects by local publics moving forward.

(ProQuest: ... denotes formulae omitted.)I.INTRODUCTIONTrade liberalization happens to make winners or losers within countries. As argued by Ricardian, Hecksher-Ohlin, and other trade models, there would be no doubt that trade liberalization creates benefit for countries implemented such policy. However, since trade liberalization demands specializations on the most efficient sectors within country, relatively less efficient sectors inevitably have less resources allocated and thus less production. It is said that trade liberalization would enhance efficiency by allowing production resource within country to be allocated in proper sectors in production but it would aggravate the fairness between sectors within a country.Since the trade negotiation results in serious gap between sectors, they would be in conflict, and thus the trade liberalization is hard to implement. Uruguay Round had to go through eight- year long negotiations, and the Trans-Pacific Partnership agreement, only with 12 countries, also took almost eight years to be concluded.This paper experimentally studies the performance of negotiation considering individual and party, like a country, share of benefit over the best ones. The experimental design for this paper considers two-stage bargaining games, internal and external negotiations. The first stage, internal negotiation, is designed to be an internal negotiations between two players. One of the two players is called power player, who would be advantageous position on the allocation of fixed amount benefit compared to other player, non-power player. The second stage of the games, external negotiation, is a divide-the dollar games between two power players in each party. The power player who is at better position in allocation of benefit participate in the external negotiation as a representative of each party. In the end, share of benefit to each party would be determined by the performance at the external negotiation, and the share attributed to each party would be divided by the allocation determined at the internal negotiation.From the experimental results, this paper is to analyze some aspects of internal and external negotiations. This paper studies (1) allocation of benefit as the result of internal negotiations, (2) share of benefit to players, and (3) factor to affect performance of external or internal negotiations on the trade negotiations. From the analyses, we can have policy implications on trade negotiations in that how to start and peruse the trade negotiations considered internal and external negotiations.Baron and Ferejohn (1989) identify the equilibrium in non-cooperative multilateral bargaining games and shows the proposing power in the legislative bargaining. Morelli (1999)'s demand bargaining game shows the limited proposing power under a various rules. Winter (1996) added the power of veto right to the Baron and Ferejohn (1989). As experimental studies on bargaining, Frechette, Kagel, and Lehrer (2003) experiment Baron and Ferejohn (1989), and Frechette, Kagel, and Morelli (2005a, 2005b, 2005c) compare Gamson (1961), Baron and Ferejohn (1989) and Morelli (1999) with diverse experimental settings. Those show the qualitative similarity but quantitative difference between experiments and the theories. Kagel, Sung, and Winter (2010), and Sung (2012, 2015a) discuss veto player games based on Baron and Ferejohn (1989) and Winter (1996). Those stress the strength of veto power, compared to that of proposing power or multiple votes. In particular, Sung (2015a) applies the experimental results on games with veto players on the trade negotiations and identifies learning mechanism in the process of negotiations. Sung (2015b) experimentally analyzes the Trans-Atlantic Trade and Investment Partnership (TTIP) using the two stage games. It sees determinants to bring better agreement in internal negotiations and factors to affect absolute size of individual prize for the TTIP. …