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Telemedical physician triage (TPT) is an example of a hierarchical knowledge-based service system (HKBSS) in which a second level of decision agent (telemedical physician) renders a decision on cases referred to him or her by the primary level agents (triage nurses). Managing the speed-versus-quality trade-off in such systems presents a unique challenge because of the interplay between agent knowledge and flow of work between the two levels. We develop a novel model of agent knowledge, based on the beta distribution, and deploy it in a partially observable Markov decision process model to describe the optimal policy for deciding which cases (patients) to refer to the second level for further evaluation. We show that this policy has a monotone control-limit structure that reduces the fraction of decisions made at the upper level as workload increases. Because the optimal policy is complex, we use structural insights from it to design two practical heuristics. These heuristics enable an HKBSS to adapt efficiently to workload shifts by adjusting the criteria for referring decisions to the upper level based on partial real-time queue length information. Finally, we conduct analytic and numerical analyses to derive insights into the management of a TPT system. We find that (1) the telemedical physician should evaluate more patients as congestion in the emergency room waiting area increases; (2) training that improves accuracy of the physician and/or nurses can be effective even if it only does so for a single patient type, but training that improves consistency must do so for all patient types to be effective; and (3) patient classification in triage should consider environmental and operational conditions in addition to the patient’s medical condition. The online appendix is available at https://doi.org/10.1287/mnsc.2017.2905 . This paper was accepted by Vishal Gaur, operations management.

It is often argued that additional constraints on redistribution such as granting veto power to more players in society better protects property from expropriation. We use a model of multilateral bargaining to demonstrate that this intuition may be flawed. Increasing the number of veto players or raising the supermajority requirement for redistribution may reduce protection on the equilibrium path. The reason is the existence of two distinct mechanisms of property protection. One is formal constraints that allow individuals or groups to block any redistribution that is not in their favor. The other occurs in equilibrium where players without such powers protect each other from redistribution. Players without formal veto power anticipate that the expropriation of other similar players will ultimately hurt them and thus combine their influence to prevent redistributions. In a stable allocation, the society exhibits a “class” structure with class members having equal wealth and strategically protecting each other from redistribution.

Social influence is typically studied after a product is released. Yet, audience expectations and discussions begin before a product’s release. This observation suggests a need to understand adoption processes over a product’s life cycle. To explore pre- and postrelease social influence processes, this article uses survey data from Americans exposed to word of mouth for 309 Hollywood movies released over two and a half years. The data suggest pre- and postrelease social influences operate differently. Prerelease social influence displays a critical transition point with relation to adoption: before a critical value, any level of social influence is negligibly related to adoption, but after the critical value, the relationship between social influence and adoption is large and substantive. In contrast, postrelease social influence exhibits a positive linear relationship with adoption. Prerelease social influence is argued to require more exposures than postrelease social influence because of differences in the diagnosticity and accessibility of the information. To complement the survey data, computational models are used to test alternative hypotheses. Evidence from the computational models supports the proposed model of social influence.

The alignment of bargaining positions is crucial to a successful negotiation. Prior research has shown that similarity in language use is indicative of the conceptual alignment of interlocutors. We use latent semantic analysis to explore how the similarity of language use between negotiating parties develops over the course of a three-party negotiation. Results show that parties that reach an agreement show a gradual increase in language similarity over the course of the negotiation. Furthermore, reaching the most financially efficient outcome is dependent on similarity in language use between the parties that have the most to gain from such an outcome.

A puzzling feature of self-governing organizations is persistent majority support for restrictive, seemingly nonmajoritarian, procedures (e.g., chairs and committees). This article provides a theory of self-enforcing majoritarian commitment to restrictive procedures. We ask (1) why majorities consent to restrictive procedures in the first place, (2) why restrictive procedures survive challenges thereafter, and (3) with what policy consequences. In the model, a risk-averse majority allocates procedural rights to increase procedural efficiency (i.e., reduce the procedural uncertainty of free-for-all bargaining). An equilibrium procedure is generally asymmetric and restrictive, generating nonmajoritarian policy bias. Still, a majority may persist in endorsing it so as to avoid amplifying procedural and policy uncertainty

A company that faces a crisis can reestablish trust with stakeholders by announcing an independent investigation by a third party. Announcing an independent investigation, without knowing its outcome, significantly restored attitudes toward the company while an internal investigation was ineffective. Liberals responded most positively to a company that invited an independent investigation by a consumer advocacy group (Study 1). Experimentally activating liberal values using an implicit priming procedure likewise enhanced credibility transfer from a consumer advocacy group's investigation to a company in crisis (Study 2).

We present the data from a crowdsourced project seeking to replicate findings in independent laboratories before (rather than after) they are published. In this Pre-Publication Independent Replication (PPIR) initiative, 25 research groups attempted to replicate 10 moral judgment effects from a single laboratory’s research pipeline of unpublished findings. The 10 effects were investigated using online/lab surveys containing psychological manipulations (vignettes) followed by questionnaires. Results revealed a mix of reliable, unreliable, and culturally moderated findings. Unlike any previous replication project, this dataset includes the data from not only the replications but also from the original studies, creating a unique corpus that researchers can use to better understand reproducibility and irreproducibility in science.

This crowdsourced project introduces a collaborative approach to improving the reproducibility of scientific research, in which findings are replicated in qualified independent laboratories before (rather than after) they are published. Our goal is to establish a non-adversarial replication process with highly informative final results. To illustrate the Pre-Publication Independent Replication (PPIR) approach, 25 research groups conducted replications of all ten moral judgment effects which the last author and his collaborators had 'in the pipeline' as of August 2014. Six findings replicated according to all replication criteria, one finding replicated but with a significantly smaller effect size than the original, one finding replicated consistently in the original culture but not outside of it, and two findings failed to find support. In total, 40% of the original findings failed at least one major replication criterion. Potential ways to implement and incentivize pre-publication independent replication on a large scale are discussed. (PsycINFO Database Record (c) 2019 APA, all rights reserved)

This research examines how two dimensions of moral intensity involved in a corporation’s external crisis response—magnitude of effectiveness and interpersonal proximity—influence observer perceptions of and behavioral intentions toward the corporation. Across three studies, effectiveness decreased negative perceptions and increased pro-organizational intentions via ethical judgment of the response. Moreover, the two dimensions interacted such that a response high in proximity but low in effectiveness led to more negative perceptions and to less pro-organizational intentions. This interaction was particularly pronounced if the corporation portrayed itself as communal-oriented. The interaction was mediated by individuals’ ethical judgment, which was a function of the corporation’s perceived benevolent concern. We termed the interaction the Strategic Samaritan, for it was when the corporation tried to appear like a Good Samaritan, displaying proximity with victims but not accompanying it with effective help, that it was seen as acting with less benevolent concern.

Legislative speech records from the 101st to 108th Congresses of the US Senate are analysed to study political ideologies. A widely-used text classification algorithm – Support Vector Machines (SVM) – allows the extraction of terms that are most indicative of conservative and liberal positions in legislative speeches and the prediction of senators’ ideological positions, with a 92 per cent level of accuracy. Feature analysis identifies the terms associated with conservative and liberal ideologies. The results demonstrate that cultural references appear more important than economic references in distinguishing conservative from liberal congressional speeches, calling into question the common economic interpretation of ideological differences in the US Congress.

This paper presents a dynamic model of elections, government formation, and legislation in a parliamentary democracy with proportional representation in which the policy chosen in one period becomes the status quo for the next period. The electorate votes strategically by taking into account the likely governments that parties would form based on their representation and the policies they would choose as a function of the status quo. The status quo thus affects both the election outcomes and the bargaining power of the parties during government formation. A formateur party therefore has incentives to strategically position the current policy to gain an advantage in both the next election and the subsequent bargaining over government formation and policy choice. These incentives can give rise to centrifugal forces that result in policies that are outside the Pareto set of the parties.

We present a dynamic model of legislative bargaining with an endogenously evolving default policy and a persistent agenda setter. Policy making proceeds until the agenda setter can no longer pass a new policy to replace an approved bill. We prove existence and necessary conditions of pure-strategy stationary equilibria for any finite policy space, any number of players, and any preference profile. In equilibrium, the value of proposal power is limited compared to the case that disallows reconsideration, as voters are induced to protect each other's benefits to maintain their future bargaining positions. The agenda setter, in turn, would prefer to limit his ability to reconsider. The lack of commitment due to the possibility of reconsideration, however, enhances policy efficiency. Copyright 2011, Oxford University Press.

We present a theory of parties-in-legislatures that can generate partisan policy outcomes despite the absence of any party-imposed voting discipline. Legislators choose all procedures and policies through majority-rule bargaining and cannot commit to vote against their preferences on either. Yet, off-median policy bias occurs in equilibrium because a majority of legislators with correlated preferences has policy-driven incentives to adopt partisan agenda-setting rules—as a consequence, bills reach the floor disproportionately from one side of the ideological spectrum. The model recovers, as special cases, the claims of both partisan and nonpartisan theories in the ongoing debate over the nature of party influence in the U.S. Congress. We show that (1) party influence increases in polarization, and (2) the legislative median controls policy making only when there are no bargaining frictions and no polarization. We discuss the implications of our findings for the theoretical and empirical study of legislatures.

The higher legislative success of parliamentary governments relative to presidential governments has been used to argue that legislative success is driven by parliamentary governments' superior agenda power or their control of legislative majorities. We show that this approach is at odds with some of the empirical regularities across and within political systems. We then propose a legislative bargaining model to elucidate this puzzle. In the model, the policies of a confidence-dependent parliamentary government enjoy more predictable support from governing coalition members because their short-term policy goals are less important than the government's survival. Coalition support is stronger when the government has more agenda power and is weaker with a larger ruling coalition. We explore the empirical implications of these findings and their consequences for the comparative study of legislative institutions. Copyright 2011, Oxford University Press.

This article presents a theory of government expenditure and identifies how an inefficient government budget is shaped by its initial size and allocation. Assuming that the parties in the legislative body agree with the optimal size of a government budget but have conflict of interests over its allocation, we show that, if the initial budget size is sufficiently large and the initial allocation is sufficiently unequal, in equilibrium the budget size is greater than what it would be had the initial budget size been sufficiently small.

Prediction markets, in which contract prices are used to forecast future events, are increasingly applied to various domains ranging from political contests to scientific breakthroughs. However, the dynamics of such markets are not well understood. Here, we study the return dynamics of the oldest, most data-rich prediction markets, the Iowa Electronic Presidential Election “winner-takes-all” markets. As with other financial markets, we find uncorrelated returns, power-law decaying volatility correlations, and, usually, power-law decaying distributions of returns. However, unlike other financial markets, we find conditional diverging volatilities as the contract settlement date approaches. We propose a dynamic binary option model that captures all features of the empirical data and can potentially provide a tool with which one may extract true information events from a price time series.

We use agent-based modeling to investigate the effect of conservatism and partisanship on the efficiency with which large populations solve the density classification task--a paradigmatic problem for information aggregation and consensus building. We find that conservative agents enhance the populations' ability to efficiently solve the density classification task despite large levels of noise in the system. In contrast, we find that the presence of even a small fraction of partisans holding the minority position will result in deadlock or a consensus on an incorrect answer. Our results provide a possible explanation for the emergence of conservatism and suggest that even low levels of partisanship can lead to significant social costs., Comment: 11 pages, 5 figures

Competitive elections are frequently decided by which side can generate larger turnout on polling day. When decided on whether to turn out voters are assumed to balance the cost of going to the polls with the prospect of making a difference in the election outcome. We present a stochastic model of turnout where voters receive information about current turnout propensities of the voting populus through opinion polls. Voters then decide on whether to vote or not by maximizing their expected utility based on the (potentially noisy) polling information as well as the costs and benefits of participation. We prove the existence of a unique limiting distribution for the process and show that even in large electorates substantial expected turnout is possible if voting factions are sufficiently similar in size. A key requirement for substantial turnout is that polls never provide precise feedback on the current state of the electorate. The effect of noise, however, is non-monotonic: no noise or too much noise results in vanishing turnout, while moderate noise may result in substantial turnout. Our model also can account for known empirical regularities about turnout identified in the political science literature.

This paper presents a model of consumer boycotts where the discrete choices of concerned consumers are represented as stochastic processes. Boycotts are interpreted as a form of voting where consumers are trying to shape the behavior of firms. We solve for the limiting distribution of the process and analyze its properties. We then discuss how the model relates to standard game-theoretic approaches to the same phenomenon and show that our model selects one of the many solutions of the corresponding game-theoretic treatment. The type of solution selected depends on the costs and benefits of boycotts to consumers. Specifically, boycotts will occur if and only if they are efficient for consumers.

This article presents a novel automatic method of text analysis aimed at discovering patterns of lexical cohesion in political speech. The unit of analysis are groups of words with related meanings; the software is based on the results of a multiperson annotation experiment that captures reliably identified connections between words in a text. We illustrate the advantages of such a representation by juxtaposing results of a detailed hand-made analysis of Margaret Thatcher's rhetoric with analysis based on the automatically detected groups of words. We both corroborate previous findings regarding Thatcher's rhetorical tools and illuminate additional elements thereof. We suggest that lexical cohesion analysis is a promising technique to bridge the gap between quantitative and qualitative analyses of text as political material, by establishing units that are both robust enough to enable comprehensive coverage and coherent enough to support direct interpretation.

We present an experimental approach to study the micro-dynamics of coalition formation in an unrestricted bargaining environment. Specifically, we investigate a fundamental feature of sequential coalition bargaining models: expectations about future bargaining behavior will influence current bargaining outcomes. To do so, we test the hypothesis that coalition bargaining may lead to inefficient outcomes as agents are unable to effectively commit to preliminary agreements during the bargaining process. We conjecture that communication plays an important role in establishing such commitments. We then experimentally manipulate the communication channels and show that restrictions undermine trust and lead to decreased efficiency.

In this paper we present a structural approach to the study of government formation in multi-party parliamentary democracies. The approach is based on the estimation of a stochastic bargaining model which we use to investigate the effects of specific institutional features of parliamentary democracy on the formation and stability of coalition governments. We then apply our methodology to estimate the effects of governmental bicameralism. Our main findings are that eliminating bicameralism does not affect government durability, but does have a significant effect on the composition of governments leading to smaller coalitions. These results are due to an equilibrium replacement effect: removing bicameralism affects the relative durability of coalitions of different sizes which in turn induces changes in the coalitions that are chosen in equilibrium.

We propose a rigorous modeling framework for characterizing the structural ability of organizations to respond quickly and effectively to unanticipated events. As such, we seek to provide a theoretical basis for improved crisis management strategies. Our framework conceptualizes organizations as adaptive, responsive networks. Most of the existing models of complex social networks to date, however, have not explicitly modeled human capacity constraints or system congestion. As a result, no viable frameworks exist for investigating the responsiveness of various organizational structures under crisis conditions. Our approach proposes to integrate the social network approach to modeling communication and collaboration with the flow network approach from production systems modeling to represent task processing and flow under crisis conditions. By providing analytic structure to decision making environments currently viewed as not amenable to formal methods, this research, we hope, will help improve the perform...

Theories in political economy depend critically on assumptions about motivations of politicians. Our analysis starts from the premise that politicians, like other economic agents, are rational individuals who make career decisions by comparing the expected returns of alternative choices. The main goal of the paper is to quantify the returns to a career in the United States Congress. To achieve this goal we specify a dynamic model of career decisions of a member of Congress and we estimate this model using a newly collected data set. Given estimates of the structural model, we assess reelection probabilities for members of Congress, estimate the effect of congressional experience on private and public sector wages, and quantify the value of a congressional seat. Moreover, we use the estimated model to assess how an increase in the congressional wage or the imposition of term limits would affect the career decisions of politicians and the returns to a career in Congress.

In this paper we present a structural approach to the study of government formation in multi-party parliamentary democracies. The approach is based on the estimation of a stochastic bargaining model which we use to investigate the effects of specific institutional features of parliamentary democracy on the formation and dissolution of coalition governments. We illustrate our methodology by presenting the results of two (counterfactual) experiments of comparative constitutional design.

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.

We present an empirical assessment of Lupia and Strøm's noncooperative bargaining model of cabinet terminations. We construct a stochastic version of the model and derive several testable implications. As the next mandatory election approaches: (1) the probability of an early election increases; (2) a cabinet's risks of being replaced without an intermediate election may be flat or even decrease; and (3) the overall chance that a cabinet falls (for whatever reason) increases. Using nonparametric duration analysis on a 15-country data set, we find qualified support for the Lupia and Strøm model. We conclude that the strategic approach is more promising than the nonstrategic alternative, but a more fully dynamic strategic model will be required to account for the dynamics of cabinet stability.

Theories of organization of legislatures have mainly focused on the U.S. Congress, explaining why committee systems emerge there, but not explaining variance in organization across legislatures of different countries. To analyze the effects of different constitutional features on the internal organization of legislatures, we adopt a vote-buying model and consider the incentives to delegate decision rights in a game among legislative chambers. We show how presidential veto power and bicameral separation can encourage a legislative chamber to create internal veto players or supermajority rules, while a unicameral structure can encourage legislators to delegate power to a leader. (JEL D72)

Strategic models of coalition bargaining formation have demonstrated the importance of institutional features for an understanding of cabinet formation in West European democracies. Yet little is know about the empirical regularities of government formation processes. In this article we analyse the duration of formation processes using a semi-parametric estimation procedure on a dataset of 304 government formations in thirteen multi-party democracies. The results are consistent with a bargaining approach under incomplete information.

This paper summarizes our recent work on analyzing the effects of constitutional features on legislative outcomes and voting behavior. It illustrates how a general framework may be used to examine the effects of one of the principal features of parliamentary democracy: the vote of confidence procedure. We show how the confidence procedure creates incentives for governing coalitions to vote cohesively on policy issues that might otherwise split them. As a consequence, legislative majorities in parliamentary democracies behave in a more disciplined fashion and capture more of the legislative rents than in non-parliamentary settings.

It is often argued that additional checks and balances provide economic agents with better protection from expropriation of their wealth or productive capital. We demonstrate that in a dynamic political economy model this intuition may be flawed. Surprisingly, increasing the number of veto players or the majority requirement for redistribution may reduce property right protection on the equilibrium path. The reason is the existence of two distinct mechanisms of property rights protection. One are formal constraints that allow individuals or groups to block any redistribution which is not in their favor. The other occurs in equilibrium where agents without such powers protect each other from redistribution. Players without formal blocking power anticipate that the expropriation of other similar players will ultimately hurt them and thus combine their influence to prevent redistributions. Yet, such incentives can be undermined by adding formal constraints. The flip-side of this effect is that individual investment efforts might require coordination. The model also predicts that the distribution of wealth in societies with weaker formal institutions (smaller supermajority requirements) among players without veto power will tend to be more homogenous.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

Framing, the effect of context on cognitive processes, is a prominent topic of research in psychology and public opinion research. Research on framing has traditionally relied on controlled experiments and manually annotated document collections. In this paper we present a method that allows for quantifying the relative strengths of competing linguistic frames based on corpus analysis. This method requires little human intervention and can therefore be efficiently applied to large bodies of text. We demonstrate its effectiveness by tracking changes in the framing of terror over time and comparing the framing of abortion by Democrats and Republicans in the U.S.

It is often argued that additional constraints on redistribution such as granting veto power to more players in the society makes property better protected from expropriation. We use a legislative bargaining-type model to demonstrate that this intuition may be ‡flawed. Increasing the number of veto players or raising the supermajority requirement for redistribution may reduce protection on the equilibrium path. The reason is the existence of two distinct mechanisms of property rights protection. One is formal constraints that allow individuals or groups to block any redistribution that is not in their favor. The other occurs in equilibrium where players without such powers protect each other from redistribution. Players without formal veto power anticipate that the expropriation of other similar players will ultimately hurt them and thus combine their infl‡uence to prevent redistributions. In a stable allocation, the society exhibits a “class”structure with class members having equal wealth, and strategically protecting each other from redistribution.

Genetic algorithms (GAs) have been used to find efficient solutions to numerous fundamental and applied problems. While GAs are a robust and flexible approach to solve complex problems, there are some situations under which they perform poorly. Here, we introduce a genetic algorithm approach that is able to solve complex tasks plagued by so-called ''golf-course''-like fitness landscapes. Our approach, which we denote variable environment genetic algorithms (VEGAs), is able to find highly efficient solutions by inducing environmental changes that require more complex solutions and thus creating an evolutionary drive. Using the density classification task, a paradigmatic computer science problem, as a case study, we show that more complex rules that preserve information about the solution to simpler tasks can adapt to more challenging environments. Interestingly, we find that conservative strategies, which have a bias toward the current state, evolve naturally as a highly efficient solution to the density classification task under noisy conditions.

Social groups of interacting agents display an ability to coordinate in the absence of a central authority, a phenomenon that has been recently amplified by the widespread availability of social networking technologies. Models of opinion formation in a population of agents have proven a very useful tool to investigate these phenomena that arise independently of the heterogeneities across individuals and can be used to identify the factors that determine whether widespread consensus on an initial small majority is reached. Recently, we introduced a model in which individual agents can have conservative and partisan biases. Numerical simulations for finite populations showed that while the inclusion of conservative agents in a population enhances the population's efficiency in reaching consensus on the initial majority opinion, even a small fraction of partisans leads the population to converge on the opinion initially held by a minority. To further understand the mechanisms leading to our previous numerical results, we investigate analytically the noise driven transition from a regime in which the population reaches a majority consensus (efficient), to a regime in which the population settles in deadlock (non-efficient). We show that the mean-field solution captures what we observe in model simulations. Populations of agents with no opinion bias show a continuous transition to a deadlock regime, while populations with an opinion bias, show a discontinuous transition between efficient and partisan regimes. Furthermore, the analytical solution reveals that populations with an increasing fraction of conservative agents are more robust against noise than a population of naive agents because in the efficient regime there are relatively more conservative than naive agents holding the majority opinion. In contrast, populations with partisan agents are less robust to noise with an increasing fraction of partisans, because in the efficient regime there are relatively more naive agents than partisan agents holding the majority opinion.

Informational theories of legislative institutions have demonstrated the potential collective gains from committee specialization due to the use of restrictive amendment procedures. For these benefits to be realized, however, the floor majority must overcome a commitment problem. I demonstrate that in a multistage game, majority rule, combined with the fact that generations of legislators overlap, allows the legislature to solve the commitment problem and to sustain legislative norms and institutions even if legislators are “finitely lived.” The model suggests that rather than restrictive amendment procedures, it is the committee's expectation of floor deference that sustains committee specialization. As a consequence, legislative norms may collapse due to an unexpected influx of new members even if the distribution of preferences in the legislature does not change. Finally, I discuss consequences for a comparative study of legislative institutions.

We present a dynamic model of legislative bargaining in which policy making proceeds until the proposer has no more incentive to make a new proposal to replace the previously approved policy. We characterize stationary Markov perfect equilibria for the game and show that in all pure-strategy equilibria, a majority of voters without proposal power have an incentive to protect each others' benefits to secure their own long-term bargaining positions in the legislature. As a consequence, the value of proposal power is constrained.

Using metaphor-annotated material that is sufficiently representative of the topical composition of a similar-length document in a large background corpus, we show that words expressing a discourse-wide topic of discussion are less likely to be metaphorical than other words in a document. Our results suggest that to harvest metaphors more effectively, one is advised to consider words that do not represent a discourse topic.

In this paper we present a structural approach to the study of government formation in multi-party parliamentary democracies. The approach is based on the estimation of a stochastic bargaining model which we use to investigate the effects of specific institutional features of parliamentary democracy on the formation and stability of coalition governments. We then apply our methodology to estimate the effects of governmental bicameralism. Our main findings are that eliminating bicameralism does not affect government durability, but does have a significant effect on the composition of governments leading to smaller oalitions. These results are due to an equilibrium replacement effect: removing bicameralism affects the relative durability of coalitions of different sizes which in turn induces changes in the coalitions that are chosen in equilibrium.

Recent empirical studies by Persson and Tabellini show that, in parliamentary countries with proportional representation, government spending as a fraction of GDP goes up during cyclical downturns but does not come down during cyclical upturns, whereas this ratchet effect is not apparent in countries with other constitutional arrangements. This paper presents a dynamic theory of public finance and shows how the institution of legislative bargaining may lead to the asymmetric movement of government spending. A key assumption is that entitlement programs, once enacted, are in effect until they are reformed. When an economy is hit by a temporary negative income shock, the party that controls agenda setting faces a strong resistance on expenditure cuts. This is because a more stringent entitlement program on any socioeconomic group implies a worse status quo in the future and therefore a permanently lower bargaining power of that group. On the other hand, with a temporary positive income shock, the leading party can easily satisfy its coalition partners by their reservation values and pass a more generous entitlement program to benefit the socioeconomic group it represents.

This paper contains additional details about the model in our paper “A Political Economy Model of Congressional Careers” (Diermeier, Keane and Merlo (2004)), as well as the computational methods we use to solve and estimate the model, and the construction of the data set.