Bargaining in Legislatures, Portfolio Allocation, and the Electoral Costs of Governing

What motivates political parties in the legislative arena? Existing legislative bargaining models stress parties’ office and policy motivations. A particularly important question concerns how parties in coalition government agree the distribution of cabinet seats. We add to this portfolio allocation literature by suggesting that future electoral considerations affect bargaining over the allocation of cabinet seats in multi-party cabinets. Some parties are penalized by voters for participating in government, increase the attractiveness of staying in opposition. This “cost of governing” shifts their seat reservation price– the minimum cabinet seats demanded in return for joining the coalition. Results of a randomized survey experiment of Irish legislators support our expectation, demonstrating that political elites are sensitive to future electoral losses when contemplating the distribution of cabinet seats. This research advances our understanding of how parties’ behavior between elections is influenced by anticipation of voters’ reaction.