Power brokers: Middlemen in legislative bargaining

Publication Year
2016

Type

Journal Article
Abstract
We study a model of decentralized legislative bargaining over public decisions with transfers. We establish the emergence of middlemen in legislative bargaining as a robust equilibrium phenomenon. We show that legislative intermediation can impact policy outcomes, and can be inefficient. To fulfill this role, the middleman's policy preferences and bargaining position must be such that its role of intermediary is credible. But the political middleman must also directly benefit from policy change. The results highlight fundamental differences between the role of intermediaries in politics and exchange economies.
Journal
Journal of Economic Theory
Volume
162
Pages
209–236
ISSN Number
10957235