Strategic Alliances in a Veto Game: An Experimental Study

Sang-Hyun Kim, Chulyoung Kim, Jinhyuk Lee and Joosung Lee
Additional contact information
Chulyoung Kim: Yonsei University
Jinhyuk Lee: Korea University
Joosung Lee: University of Edinburgh

No 2022rwp-198, Working papers from Yonsei University, Yonsei Economics Research Institute

Abstract: In a veto game, we investigate the effects of “buyout” which allows non-veto players strategically form an intermediate coalition. First, our experimental findings show that the proportion of intermediate coalition formation is much lower than predicted by theory, regardless of the relative negotiation power between veto and non-veto players. Second, allowing coalition formation among non-veto players does not affect the surplus distribution between veto and nonveto players, which diverges from core allocations. These findings contrast to the literature, which views the ability to form an intermediate coalition as a valuable asset for non-veto players in increasing their bargaining power.

Keywords: game theory; coalition bargaining; veto game; experiment; non-core allocation; intermediate coalition formation. (search for similar items in EconPapers)
JEL-codes: C72 C78 C92 D72 D74 (search for similar items in EconPapers)
Pages: 35pages
Date: 2022-08
New Economics Papers: this item is included in nep-cdm, nep-exp and nep-gth
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Related works:
Journal Article: Strategic alliances in a veto game: An experimental study (2022)
Working Paper: Strategic Alliances in a Veto Game: An Experimental Study (2021)
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