Pork-barrel politics, discriminatory policies and fiscal federalism

This paper examines the role of discriminatory policy tools in a model of redistributive politics with jurisdictional specific projects. In equilibrium, the ability to tactically target both jurisdictional specific projects, with benefits concentrated within a given jurisdiction, and the costs associated with those projects across multiple jurisdictions, leads to inefficiency in the provision of the “local” projects. In particular, politically motivated discrimination in the provision of local projects and/or their associated costs results in the foregoing of efficient projects. However, greater discriminatory ability in the set of available policies lowers the level of inefficiency in the provision of the local projects. -- Dieser Aufsatz untersucht in einem Modell umverteilender Politik die Rolle von lokalen öffentlichen Gütern und öffentlichen Projekten in einzelnen Jurisdiktionen. Politiker können aus strategischen Gründen bestimmte lokale Projekte durchführen und dadurch gezielt bestimmte Gebietskörperschaften beeinflussen, welche die Vorteile dieser Projekte genießen, während die damit verbundenen Kosten von mehreren Jurisdiktionen getragen werden. Dies führt zu einer Ineffizienz in der Durchführung solcher lokalen Projekte. Insbesondere führt eine politisch motivierte Ungleichbehandlung verschiedener Gebietskörperschaften bei der Durchführung lokaler Projekte bzw. ihrer Finanzierung dazu, dass manche effizienten Projekte nicht durchgeführt werden. Allerdings geht diese Ineffizienz zurück, wenn es größere Möglichkeiten zu ungleicher Behandlungen verschiedener Jurisdiktionen gibt.Fiscal Federalism,redistributive politics,distributive politics,Colonel Blotto

Inefficient Redistribution and Inefficient Redistributive Politics

This paper examines the effect of inefficient redistribution in Myerson’s (1993) model of redistributive politics. Regardless of the absolute levels of the efficiency of political parties’ transfers to different voter segments, parties have incentive to (stochastically) shift resources away from voter segments with large relative efficiency gaps between the two parties’ transfers towards voter segments with smaller relative efficiency gaps. Because of this dependence on relative, and not absolute, levels of efficiency, the parties’ optimal strategies may lead to large discrepancies between the sum of the budgetary transfers and the sum of the effective transfers. At the extreme, in the spirit of Magee, Brock, and Young (1989), we obtain “black hole” inefficiency. When the model is extended to allow for loyal voter segments and loyalty to a party is positively related to the efficiency of that party’s transfers to the segment, the incentives leading to black hole inefficiency become even stronger.

The Optimal Defense of Networks of Targets

This paper examines a game-theoretic model of attack and defense of multiple networks of targets in which there exist intra-network strategic complementarities among targets. The defender’s objective is to successfully defend all of the networks and the attacker’s objective is to successfully attack at least one network of targets. In this context, our results highlight the importance of modeling asymmetric attack and defense as a conflict between “fully” strategic actors with endogenous entry and force expenditure decisions as well as allowing for general correlation structures for force expenditures within and across the networks of targets.Asymmetric Conflict, Attack and Defense, Weakest-Link, Best-Shot

The Non-Constant-Sum Colonel Blotto Game

The Colonel Blotto game is a two-player constant-sum game in which each player simultaneously distributes his fixed level of resources across a set of contests. In the traditional formulation of the Colonel Blotto game, the players’ resources are “use it or lose it” in the sense that any resources which are not allocated to one of the contests are forfeited. This article examines a non-constant-sum version of the Colonel Blotto game which relaxes this use it or lose it feature. We find that if the level of asymmetry between the players’ budgets is below a threshold, then there exists a oneto- one mapping from the unique set of equilibrium univariate marginal distribution functions in the constant-sum game to those in the non-constant-sum game. Once the asymmetry of the players’ budgets exceeds the threshold this relationship breaks down and we construct a new equilibrium.Colonel Blotto Game, All-Pay Auction, Contests, Mixed Strategies

Inefficient redistribution and inefficient redistributive politics

This paper examines the effect of inefficient redistribution in Myerson’s (1993) model of redistributive politics. Regardless of the absolute levels of the efficiency of political parties’ transfers to different voter segments, parties have incentive to (stochastically) shift resources away from voter segments with large relative efficiency gaps between the two parties’ transfers towards voter segments with smaller relative efficiency gaps. Because of this dependence on relative, and not absolute, levels of efficiency, the parties’ optimal strategies may lead to large discrepancies between the sum of the budgetary transfers and the sum of the effective transfers. At the extreme, in the spirit of Magee, Brock, and Young (1989), we obtain „black hole” inefficiency. When the model is extended to allow for loyal voter segments and loyalty to a party is positively related to the efficiency of that party’s transfers to the segment, the incentives leading to black hole inefficiency become even stronger. -- Diese Arbeit untersucht die Auswirkung von ineffizienter Umverteilungspolitk im Rahmen des Modells von Myerson (1993). Parteien versuchen, Wählersegmente für sich zu gewinnen, indem sie ihnen Transferzahlungen zusagen. Einzelne Wählersegmente unterscheiden sich in der Effizienz, mit der sich die Transferzahlungen einer bestimmten Partei in einen resultierenden Nutzengewinn für den Wähler übersetzen. Für die Parteien entsteht ein Anreiz, (stochastisch) Ressourcen hin zu Wählersegmenten zu verlagern, bei denen die Transfers von zwei verschiedenen Parteien einen relativ kleinen Unterschied in ihrem Effizienzniveau aufweisen, ungeachtet des absoluten Effizienzniveaus der Transferzahlung. Aufgrund dieser Abhängigkeit von relativen und nicht absoluten Effizienzniveaus können die Gleichgewichtsstrategien der Parteien zu großen Unterschieden zwischen der Summe der getätigten Transfers und der Summe der effektiv erhaltenen Transfers führen. Im Extremfall erhalten wir „black hole“-Ineffizienz wie in Magee, Brock und Young (1989). Eine Erweiterung des Modells um loyale Wählersegmente, bei der Loyalität zu einer Partei in positivem Bezug zur Effizienz der von dieser Partei erhaltenen Transfers steht, verstärkt die Anreize, die zu „black hole“-Ineffizienz führen.Redistributive politics,redistribution,inefficiency

The Non-Constant-Sum Colonel Blotto Game

The Colonel Blotto game is a two-player constant-sum game in which each player simultaneously distributes her fixed level of resources across a set of contests. In the traditional formulation of the Colonel Blotto game, the players’ resources are “use it or lose it” in the sense that any resources which are not allocated to one of the contests are forfeited. This paper examines a non-constant-sum version of the Colonel Blotto game which relaxes this use it or lose it feature. We find that if the level of asymmetry between the players’ budgets is below a threshold, then the unique set of equilibrium univariate marginal distributions of the non-constant-sum game is equivalent up to an affine transformation to the unique set of equilibrium univariate marginal distributions of the constant-sum game. Once the asymmetry of the players’ budgets exceeds the threshold we construct a new equilibrium.Colonel Blotto game, all-pay auction, contests

Conflicts with Multiple Battlefields

This paper examines conflicts in which performance is measured by the players' success or failure in multiple component conflicts, commonly termed "battlefields." In multi-battlefield conflicts, behavioral linkages across battlefields depend both on the technologies of conflict within each battlefield and the nature of economies or diseconomies in how battlefield out- comes and costs aggregate in determining payoffs in the overall conflict.Con ict, Contest, Battleeld, Colonel Blotto Game, Auction, Lottery

The Robustness of ‘Enemy-of-My-Enemy-is-My-Friend’ Alliances

This paper examines the robustness of alliance formation in a three-player, two-stage game in which each of two players compete against a third player in disjoint sets of contests. Although the players with the common opponent share no common interests, we find that under the lottery contest success function (CSF) there exists a range of parameter configurations in which the players with the common opponent have incentive to form an alliance involving a pre-conflict transfer of resources. Models that utilize the lottery CSF typically yield qualitatively different results from those arising in models with the auction CSF (Fang 2002). However, under the lottery and the auction CSFs, the parameter configurations within which players with a common opponent form an alliance are closely related. Our results, thus, provide a partial robustness result for ‘enemy-of-my-enemy-is-my-friend’ alliances.Alliance Formation, Contests, Economics of Alliances, Conflict

Electoral poaching and party identification

This paper studies electoral competition in a model of redistributive politics with deterministic voting and heterogeneous voter loyalties to political parties. We construct a natural measure of party strength based on the sizes and intensities of a party’s loyal voter segments and demonstrate how party behavior varies with the two parties’ strengths. In equilibrium, parties target or poach a strict subset of the opposition party’s loyal voters: offering those voters a high expected transfer, while freezing out the remainder with a zero transfer. The size of the subset of opposition voters frozen out and, consequently, the level of inequality in utilities generated by a party’s equilibrium redistribution schedule is increasing in the opposition party’s strength. We also construct a measure of political polarization that is increasing in the sum and symmetry of the parties’ strengths, and find that the expected ex-post inequality in utilities of the implemented policy is increasing in political polarization. -- In dieser Studie wird der Wahlkampf in einem Modellrahmen mit umverteilender Politik untersucht. Dabei gehen wir von den Annahmen deterministischen Wahlverhaltens und heterogenen Wählerbindung an die politischen Parteien aus. Wir generieren eine natürliche Messgröße für die Stärke einer Partei. Sie beruht auf der Größe und Intensität der parteiloyalen Wählersegmente und zeigt wie sich das Verhalten der Parteien verändert in Abhängigkeit von der Stärke der beiden Parteien. Im Gleichgewicht versuchen die Parteien einen Teil der loyalen Wählerschaft der Gegenpartei mit dem Versprechen hoher Transferzahlungen abzuwerben, während den restlichen Teilen der gegnerischen Wählerschaft Null-Transfers in Aussicht gestellt werden. Die Anzahl dieser letzteren Oppositionswähler, die keine Transferzahlungen erhalten werden, und das Niveau der Ungleichverteilung der Nutzen durch die im Gleichgewicht resultierende Umverteilung steigen in Abhängigkeit von der Stärke der Oppositionspartei. Des weiteren wird eine Messgröße der politischen Polarisierung konstruiert, das mit der Summe und Symmetrie der Parteienstärke steigt. Als Ergebnis lässt sich feststellen, dass das erwartete ex-post Ungleichgewicht des Nutzens der implementierten Politik ansteigt, je stärker die politische Polarisierung ist.

Conflicts with Multiple Battlefields

This paper examines conflicts in which performance is measured by the players' success or failure in multiple component conflicts, commonly termed “battlefields”. In multi-battlefield conflicts, behavioral linkages across battlefields depend both on the technologies of conflict within each battlefield and the nature of economies or diseconomies in how battlefield out-comes and costs aggregate in determining payoffs in the overall conflict.conflict, contest, battlefield, Colonel Blotto Game, auction, lottery