The Revenue Equivalence Theorem is generalized to the case of asymmetric auctions in which each player’s valuation is drawn independently from a common support according to his/her distribution function. r 2003 Elsevier Inc. All rights reserved. JEL classification: D44; D72; D82

This short paper analyzes whether a federal transfer system can be designed to increase welfare, when state governments create political budget cycles to increase the likelihood of reelection. The results show how the federal government may announce a transfer scheme in advance for the post-election year that counteracts the welfare costs of political budget cycles. JEL Classification: D61, D72...

I introduce a model of corporate voting. I characterize the shareholder majority rule as the unique corporate voting rule that satisfies four axioms: anonymity, neutrality, share monotonicity, and merger, a property that requires consistency in election outcomes following stock-for-stock mergers. JEL classification: D71, D72, K22

We prove uniqueness of stationary equilibria in a one-dimensional model of bargaining with quadratic utilities, for an arbitrary common discount factor. For general concave utilities, we prove existence and uniqueness of a “minimal” stationary equilibrium and of a “maximal” stationary equilibrium. We provide an example of multiple stationary equilibria with concave (non-quadratic) utilities. Jo...

This paper studies how political fragmentation affects government stability. Using a regression discontinuity design, we show that each additional party with representation in the local parliament increases probability incumbent is unseated by 5 percentage points. The entry of an stability reducing single-party majority and increasing instability governments when such not available. We interpre...

I show that a unique equilibrium exists in an asymmetric two-player all-pay auction with a discrete signal structure, correlated signals, and interdependent valuations. The proof is constructive, and the construction can be implemented as a computer program and be used to derive comparative statics. I also characterize the set of equilibria when a reserve price is introduced. JEL Classification...

In this paper we consider a dynamic model of government formation and termination in parliamentary democracies that accounts for the following phenomena: (1) Cabinet terminations due to replacement or early election (2) Cabinet reshuf°es (3) Minority and Surplus governments; (4) the relative instability of minority governments. JEL classi ̄cation: D72, H19, C73.

This chapter surveys formal models of endogenous alliance formation in political science and economics. Using a unified model of conflict, we obtain general results on the effect of group sizes on conflict and on the size of stable alliances. We also discuss recent work on endogenous sharing rules and dynamic alliance formation in nested conflicts. JEL Classification Numbers: D74, D72, C72