Abstract
This article studies the long-run dynamics of policy choices, government formations, and voting behavior under a parliamentary constitution and proportional representation. I develop an infinite period game where, in each period, voters participate in a proportional representation election, and three farsighted parties bargain over one-dimensional policy programs and government positions. The model incorporates the interaction between elections and coalition bargaining, which is the essence of politics in most parliamentary systems, as well as a dynamic environment of policymaking: a policy once implemented remains in effect until another replaces it. I find a Markov perfect equilibrium in which (1) there is no majority party in any election; (2) election results converge over time to a stable vote distribution; (3) policy outcomes change over time but eventually stay within a set of three points; (4) minimal winning coalitions and minority governments are formed with positive probability and alternate over time.
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Notes
A well known exception is the United Kingdom where the first-past-the-post system is used to elect MPs to the house of the commons.
We interpret this fixed prize as cabinet posts or ministerial portfolios.
We implicitly assume that an inactive caretaker government takes government positions until the next election if no agreement is reached in the government formation process.
For election result to be well defined, \(b(\cdot|x)\) must be measurable for every \(x\in X\).
In our equilibrium, each party would implement its own ideal points if it commanded a majority of seats. Then, for example, when the status quo is moderate, the right party represents two policies: it would propose policy θ if it were a majority party, and it would propose policy \(\bar{x}(\delta,\theta)\) to the middle party in the right-center coalition. Voters whose ideal points are between \(\frac{1}{2}\bar{x}(\delta,\theta)\) and \(\frac{1}{2}\theta\), though they prefer the middle party’s ideal point to the right party’s, will vote for the right party, because the right-center coalition is their best outcome. The complete equilibrium strategies are available in the Appendix.
For example, there is a trivial MPE in which more than half of voters always vote for the middle party, and the middle party, as a majority party, always implements its ideal policy. However, this equilibrium is not robust against a slight change in the formateur selection process, as Cho (2013b) shows in his single period model.
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Acknowledgements
I specially thank John Duggan for his advice in many stages of developing this paper. I am also grateful to Editor-in-chief of this journal, Jane Bang, Tim Feddersen, Mark Fey, Garrett Glasgow, Tasos Kalandrakis, Insun Kang, Bing Powell and seminar participants at Harvard University, at Princeton University, and at Washington University for their helpful comments and discussions.
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Cho, Sj. Three-party competition in parliamentary democracy with proportional representation. Public Choice 161, 407–426 (2014). https://doi.org/10.1007/s11127-014-0165-3
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DOI: https://doi.org/10.1007/s11127-014-0165-3