Elections, Governments, and Parliaments in Proportional Representation Systems

David P. Baron and Daniel Diermeier

The Quarterly Journal of Economics, 2001, vol. 116, issue 3, 933-967

Abstract: This paper presents a theory of parliamentary systems with a proportional representation electoral system, a formateur selected based on party representation in parliament, and parties that cannot commit to the policies they will implement once in government. Government formation involves efficient proto-coalition bargaining, and elections yield unique strong Nash equilibrium outcomes. Depending on the status quo, minimal-majority, surplus, or consensus governments can form. If parties and voters are myopic and the status quo is subject to shocks, consensus governments and centrist policies occur only in a crisis. Otherwise, governments are minimal winning, and policies reflect only the preferences of the government parties.

Date: 2001
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