8 - Political Deals in Institutional Settings

Summary

So much of real politics involves making deals: power lunches and gentlemen's agreements; horse trades, vote swaps, and log rolls; and, at a more formal level, contracts and coalitions. All of these have at their core the notion of aligning expectations about mutual obligations and, ultimately, about the outcomes to be secured by the aligning parties. The deal is also a fundamental concept in theoretical studies of politics. In this respect, at least, theory and practice share the same foundation. In this brief essay I offer some theoretical elaboration of this concept and apply it to one of the central deals made in parliamentary democracies – the making of governments.

To begin, I offer what I believe to be the standard way in which the deal enters most theoretical analyses. Although abstract and something of a caricature, it captures most of what people mean by the concept. It also flags two potential deficiencies in standard usage – feasibility and enforceability. I take these topics up in succeeding sections of the chapter. I then suggest how the analysis affects the way we think about government formation in parliamentary democracies. A conclusion follows.

Deals in Theoretical Analysis

In conventional approaches to deal-making, of which the gametheoretic literature on bargaining is the most explicit (e.g., Osborne and Rubinstein 1990), agents of a potential deal come to a deal-making situation with endowments, opportunities, beliefs, and preferences. The deal-making situation transforms participant inputs into a result through what we might think of as the deal-making technology.