In this paper, we examine how the institutional design affects the outcome of bank bailout decisions. In the German savings bank sector, distress events can be resolved by local politicians or a state-level association. We show that decisions by local politicians with close links to the bank are...

We provide causal evidence that German savings banks where local politicians are by law involved in their management systematically adjust lending policies in response to local electoral cycles. The different timing of county elections across states and the existence of a control group of...

We consider a committee voting setup with two rounds of voting where committee members, who possess private information about the state of the world, have to make a binary decision. We investigate incentives for truthful revelation of their information in the first voting period. Coughlan (2000...

Consider a lobby group of exhaustible-resource suppliers, which bargains with the government over the extraction of an exhaustible resource and over contribution payments. We characterize the path of contributions and the resulting extraction path, taking into account how the environmental...

We study the role of an imbalance in fighting strengths when players bargain in the shadow of conflict. Our experimental results suggest: In a simple bargaining game with an exogenous mediation proposal, the likelihood of conflict is independent of the balance of power. If bargaining involves...

Pension schemes that redistribute money to the elderly have seen a remarkable surge in developing countries. To explain this phenomenon we build a political economy model of a Beveridgean pay-as-you-go social security system which incorporates family transfers driven by costs of non-compliance...

We examine the effect of citizen initiatives on finished residential area in the German federal state of Bavaria. There is already a prominent literature on the fiscal effect of initiatives and political economic reasons that drive urban development. Yet, there is almost no literature that links...

We analyze political representation of preferences of different income groups by matching referendum outcomes for low, middle, and high-income voters with individual legislators decisions on identical policy proposals. Results indicate that legislators more closely represent preferences of rich...

Due to reasons such as the capacity to govern and social stability a good understanding of citizens preferences and their informal coalitions is extremely important. Because preferences for redistribution are difficult to measure identification of latent subgroups becomes non-trivial. Moreover,...