Majoritarian bargaining over budgetary divisions and policy

Abstract

We report the results of a field-in-the-lab experiment in which subjects bargain over a two-dimensional agenda: a donation to a political interest group and the division of a sum of money. We show that subjects sacrifice monetary gains to secure preferred policies and that behaviorally elicited preference intensity correlates with bargaining behavior. We find an ideological majority advantage and a status-quo premium. Minorities benefit most from negotiating on two dimensions because the budgetary division problem allows compromise. Finally, we show that induced preferences over artificial policies fail to capture the bargaining dynamics that arise when real ideological choices are involved.