An Experimental Study on Internal and External Negotiation for Trade Agreements

This paper experimentally studies the performance of negotiation considering individual and party, like a country, share of benefit over the best ones. It experiments two-stage bargaining games, internal and external negotiations. From the experimental results, this paper shows strong tendency to select fair allocation in the internal negotiations, but the tendency would be weaker with attractive outside option. In addition, the outside option may claim difference in individual benefit. From the regressions on individual performance in the negotiations, being a proposing party would matter to enhance the performance. However, relative individual performance within party fairness matters. Still attractive no-agreement options happen to break the tendency. As policy implication for trade negotiation, this paper warns that possible loss in individual benefit from not active participation to the external negotiations, no active role of proposer in case that players stick to internal allocations, and deviation of advantageous sector due to attractive outside options

Experimental Economic Approaches on Trade Negotiations

This paper experimentally examines the multilateral bargaining games to derive some policy implications for real trade negotiations. It shows the following findings: there are significant delays in games including veto players in some circumstances, but no delays in games including multiple-vote players. In addition, non-veto players as weak players, which are disadvantaged in taking share, make collusive attempts against veto players, but not effectively. As policy implications, this paper suggests enforceable deadlines or threats toward low-quality agreements to reduce the delay problems. Furthermore, as another remedy for the delays, it suggests an effort to group countries like multiple-vote players in unequal-weight games.Veto, Trade negotiations, Delay

Dissertation abstract: Essays on veto bargaining games

This dissertation experimentally analyzes the outcomes of multilateral legislative bargaining games in the presence of a veto player. The first essay examines veto power—the right of an agent to unilaterally block decisions but without the ability to unilaterally secure his/her preferred outcome. Using Winter’s (1996) theoretical framework, I consider two cases: urgent committees where the total amount of money to be distributed shrinks by 50% if proposals do not pass and non-urgent committees where the total amount of money shrinks by 5% if proposals do not pass. Committees with a veto player take longer to reach decisions (are less efficient) than without a veto player and veto players proposals generate less consensus then non-veto players proposals, outcomes on which the theory is silent. In addition, veto power in conjunction with proposer power generates excessive power for the veto player. This suggests that limiting veto players’ proposer rights (e.g., limiting their ability to chair committees) would go a long way to curbing their power, a major concern in committees in which one or more players has veto power. Finally, non-veto players show substantially more willingness to compromise than veto players, with players in the control game somewhere in between. I relate the results to the theoretical literature on the impact of veto power as well as concerns about the impact of veto power in real-life committees. The second essay discusses in detail the voting patterns in the veto and control games reported in the first essay. The empirical cumulative density functions of shares veto players accepted first degree stochastically dominates that of shares for the controls and the empirical cdfs of shares the controls accepted first degree stochastically dominate that of shares for non-veto players. Random effect probits support this conclusion as well. In addition, regressions imply favorable treatment of voting and proposing between non-veto players which, however, does not result in larger shares in the end. Coalition partners consistently demand more than the stationary subgame perfect Nash equilibrium share except for veto players in non-urgent committees. Copyright Economic Science Association 2007Veto power, Bargaining, Committees,

Empirical Analyses of U.S. Congressional Voting on Recent FTA

This paper addresses the manner in which political and economic factors affect the voting behavior of House representatives on free trade agreement (FTA) implementation bills in the 108th and 109th Congresses in the U.S., using a simultaneous probit-tobit model consisting of contribution and voting equations. We find that representatives whose districts have relatively higher employment in 'trade-sensitive’ sectors are likely to oppose FTA bills. By comparing our results with the reports of the U.S. International Trade Commission, we discover that the voting behavior of representatives is more receptive to the sectors predicted to be adversely affected by an FTA than to those predicted otherwise. Another finding is that when FTA bills, for which partner countries do not share commonalities, are considered on the same day in the House, members’ voting behavior may be similar.

Veto power in committees: an experimental study

Veto power, Bargaining, Committees, C7, D7, C78, D72,