Delegation in Veto Bargaining

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Tác giả: Navin Kartik, Andreas Kleiner, Richard Van Weelden

Ngôn ngữ: eng

Ký hiệu phân loại: 327.2 Diplomacy

Thông tin xuất bản: 2020

Mô tả vật lý:

Bộ sưu tập: Metadata

ID: 164658

 A proposer requires the approval of a veto player to change a status quo. Preferences are single peaked. Proposer is uncertain about Vetoer's ideal point. We study Proposer's optimal mechanism without transfers. Vetoer is given a menu, or a delegation set, to choose from. The optimal delegation set balances the extent of Proposer's compromise with the risk of a veto. Under reasonable conditions, "full delegation" is optimal: Vetoer can choose any action between the status quo and Proposer's ideal action. This outcome largely nullifies Proposer's bargaining power
  Vetoer frequently obtains her ideal point, and there is Pareto efficiency despite asymmetric information. More generally, we identify when "interval delegation" is optimal. Optimal interval delegation can be a Pareto improvement over cheap talk. We derive comparative statics. Vetoer receives less discretion when preferences are more likely to be aligned, by contrast to expertise-based delegation. Methodologically, our analysis handles stochastic mechanisms.
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