Keeping tabs on partners The logic of delegation in Coalition Governments Michael F. Thies Governments require delegation: PARLIAMENT GOVERNMENT In multiparty coalitions, parties don’t enjoy full control over ministers from other parties

Governments and delegation Governments require delegation: PARLIAMENT GOVERNMENT In multiparty coalitions, parties don’t enjoy full control over ministers from other parties. Multiparty governments face greater delegation problems than single-party government for at least 2 reasons 1.Divergence of preferences 2.Difficulty of sanctions

Two options to adress delegation problems: 1.MINISTERIAL GOVERNMENT Each minister enjoys virtual dictatorship over his/her peculiar jurisdiction (or at least the right to propose policies in that area; see Laver & Shepsle coalition theory). 2.MANAGED DELEGATION Delegation without abdication: a) Monitoring what agents are doing b)Check the ability of each agent to act

Ministerial government: disadvantages Risks due to uncertainty: 1.Misperceived ideal points 2.Unforeseen issues 3.Change of the relevance of an issue In these circumstances the net cost of having ceded competence to another party rises Opportunity costs: why instead of “abdication” a mutual deference and a compromise? Compromises are unstable

Managed delegation If Delegation can be managed at relatively low cost to the coalition parties, then the coalition might be able to implement the compromise package making all coalition parties better off. EX POST CHECKS They are insufficient, since ministers might be able to deceive their cabinet colleagues into accepting proposals that make their colleagues worse off. EX ANTE CHECKS Interministerial committees Overlapping jurisdictions Junior ministers

HYPOTHESES General hypothesis Mechanisms of control are used more extensively where the risks and opportunity costs of abdication are higher. H1: Parties are more likely to monitor each other’s ministers the less contrained ministers are by other “institutional checks” (federal systems, asymmetric bicameralism, role of the Prime Minister). H2: Parties are more likely to monitor partner parties’ ministers who hold portfolios of greater salience. H3: Parties are more likely to monitor partner parties’ ministers whose preferences are more extreme. H4: Parties are more likely to monitor each others’ ministers when uncertainty is greater.

When the general salience is low, namely when each party cares much more about the jurisdiction it controls and much less about the jurisdiction controlled by its partners there is not much difference between an issue by issue compromise (x) and a ministerial government.

Empirical analysis Dependent variable: appointment of Junior Ministers (JM) Only 2 hypotheses are tested H1: Parties are more likely to monitor each other’s ministers the less contrained ministers are by other “institutional checks” (federal systems, asymmetric bicameralism, role of the Prime Minister). H2: Parties are more likely to monitor partner parties’ ministers who hold portfolios of greater salience. Five cases: Italy Germany Netherlands Japan Japan

H1: monitoring vs institutional checks Less monitoring through hostile JM when Ministers are otherwise constrained. EXPECTATIONS Germany: less monitoring as Strong prime minister (“chancellor democracy”) Federal system Inconguent bicameralism Strong legislative committees Italy, Netherlands, Japan: more monitoring as Weaker prime ministers Unitary states All bicameralism but “incongruent” only in Japan Weak committes in Japan, slightly stronger in the Netherlands, strong in Italy but with weak oversight powers

Evidence N. of ministers who have an hostile JM N. of JM allocate to an hostile minister Chances taken to allocate an hostile JM Wasted JM If a party in the coalition has few JM to allocate, it can’t cover all the hostile ministries, so we have to look at the chances taken.

H2: salience of ministries vs hostile JMs Parties are more likely to monitor partner parties’ ministers who hold portfolios of greater salience. SALIENCE Laver and Hunt 1992 Issue dimensions Top, middle, bottom tiers

Italy

Japan

Alternative explanations about Germany ?  Two party coalition as a “rule” in Germany;  A big party with a smaller ally  The major party doesn’t need to control the small one, which have few powers  The small is not interested in monitoring the other, being then unable to act. Unsatisfying reasons: Why the SPD didn’t try to monitor the FDP? The bargainig power doesn’t correspond to the party’s parliamentary representation.

Conclusions Presidential systems and multiparty governments are much in common:the conflict built into a multiparty coalition is very similar to the one inherent in a separation of powers. Once one recognizes the centrality of cross party compromise and managed delegation, multiparty parliamentarism emerges as distinct regime type from its single party cousin

Coalition Policymaking and Legislative Review Martin and Vanberg 2005

Focus on legislatures in parliamentary democracies policymaking in periods of coalition government Formal model of the interactions between coalition parties: Multiparty governments involve delegation to cabinet ministers Delegation creates agency problems Agency problems increase in severity on issues that divide the coalition Legislative review to overcome these tensions Empirical evaluation: original dataset on 336 government bills from two parliamentary democracies Results: legislatures play a more important role in parliamentary democracies than is usually appreciated

LITERATURE REVIEW Agency problems inherent to modern democratic government: citizens/government officials (Lupia and McCubbins 2000; Strøm 2000) elected official/bureaucrats (Huber and Shipan 2002) parties in a coalition: –Cabinet-level institutions as a solution (Müller and Strøm 2000; Thies 2001) –Legislative-level institutions as a solution: »They strenghten opposition parties (Powell 2000; Saalfeld 2000; Strøm 1990) »They strenghten government parties

“Principal-agent” framework Two problematic features of policymaking by coalition governments: Divergent preferences: policy and position-taking incentives of coalition parties continually put them in competition with one another Delegation to the cabinet provides considerable discretion to ministers in drafting legislation Incentives for ministerial position-taking Ministers, acting as agents of the cabinet as a whole, may not work fully in the interests of all their principals  need for ex post oversight and correction (legislative scrutiny)

Modeling coalition policymaking Coalition composed of two parties (A and B) in a one- dimensional policy space A’s ideal point: 0 B’s ideal point: X > 0 Coalition compromise at X/t, where t ≥ 1 A 0 B X>0 X/t X/t is exogenously defined because M.V.are not interested in the bargaining process inside the government As X increases, the policy divergence between the two parties increases Policy divergence

Modeling coalition policymaking A 0 B X>0 X/t Other elements affecting A and B’s Utility (different from policy outcomes) c = resource and opportunity costs in challenging the ministerial draft d = opportunity costs of drafting a proposal that ultimately does not become a law; audience costs for the drafting minister for appearing unable to implement the original version of the bill a > 0 : the importance of the position taking for the minister’s party. As a increases party A is punished more severly for making proposal far from A’s ideal point.

Coalition policymaking game A 0 B X>0 X/t AB w Choose w  (  ) accept Amend at cost c X/t 1.A minister belonging to A introduces a policy proposal w  2. In response, B can: a) accept A’s proposal b) amend A’s proposal at the cost c > 0 in order to have X/t implemented 3. The final policy p is : a) p = w if B accepts b) p = X/t if B amends. In this case A pays a cost d ≥ 0

Coalition policymaking game A 0 B X>0 X/t Which are the Payoffs of A and B in each outcome ? w

Coalition policymaking game A 0 B X>0 X/t Which are the Payoffs of A and B in each outcome ? w

Coalition policymaking game What Party B will decide to do ? Amendment threshold Because rewriting the proposal made by party A is costly (c), B is willing to accept some deviation from the coalition compromise policy (X/t). As long as A’s proposal lies above this threshold, B is willing to accept it.

Coalition policymaking game What Party A will decide to do ?

Coalition policymaking game What Party A will decide to do ? Position taking threshold

Equilibrium strategies

Expectation If the coalition is sufficiently divided, ministers face strong incentives to deviate from coalition compromises to “take a position”, thus triggering attempts by other coalition members to challenge and amend draft legislation to bring it in line with the coalition compromise Main Hypothesis The incidence of amendmends to ministerial drafts should become more pronounced as the level of policy disagreement between parties increases

Why legislative review Coalition partners possess resources that allow them to challenge and amend the draft legislation introduced by ministers Resources: Cabinet-level institutions:  Thies 2001: JMs  Müller and Strøm 2000: JMs, cabinet commitees and “inner cabinets” Legislative-level institutions: legislative review –Cost of monitoring from within the cabinet –Formal rules regarding policymaking –Systems of strong standing committees

THE DATA Original dataset: all the modifications made to government-sponsored legislation between introduction and final resolution in the lower chambers of Germany ( ) and Netherlands ( )

THE DATA Germany and Netherlands (“control by design” strategy): Policy differences between coalition parties Similar coalition-specific features –Governed by MW coalitions Similar institutional rules 1.Nonmajoritarian democracies with proportional electoral system 2.Legislative institutions that strenghten the role of legislators in policymaking: a.Large number of specialized committees (composition, jurisdiction) b.Agenda for debate determined by (a committee of) the chamber c.Committee powers not restricted by a prior decision of the plenary d.Similar voting procedure at the final voting stage (simple majority, quorum, “successive” voting method) Representative of other European parliamentary democracies (institutional features and coalition-specific features –MWC) Drawback: unable to assess the impact of alternative institutional arrangements and coalition features on the extent of bill modification Advantages of the time frame chosen: –Relatively small number of years  less prone to unmeasured temporal effect –Recent expert survey (Laver and Hunt 1992)

Unit of analysis: government bill Excluded bills: –budget bills, budgetary adjustment bills, constitutional bills –Bills non classifiable into Laver and Hunt’s eight policy dimensions 336 government bills

Delegation to cabinet ministers poses a principal-agent problem for coalition governments This problem is particularly pronounced on issues that divide the coalition internally Parties will take advantage of the opportunities presented by the legislative process (legislative review) to counteract the negative effect of delegation to ministers Implication: we should see more such “corrective” activity on bills that divide the coalition

OPERATIONALIZATION: the dependent variable How to measure the degree to which ministerial drafts of government bills are changed in the course of legislative review? (ideally) Policy impact of changes  But hard to determine for both legislators and political scientists Number of articles changes Number of articles altered (or deleted) in the draft version of bill + Number of new articles added to the draft version of bill From 0 to… Advantages of this measure: –Articles are the logical “policy subunits” of a bill (the substantial impact of changes is captured) –Reliably coded by other researchers

Dependent and independent variables: descriptives

The independent variables: Key explanatory variable: Government issue divisiveness Hypothesis: as the coalition becomes more divided on policy, coalition partners are more likely to make use of the legislative process to “correct” government bills Control variables: –Opposition issue divisiveness Hypothesis: if the opposition does possess significant influence over policymaking, we should expect more changes being made to those bills dealing with issues that greatly divide opposition parties from the party of the minister proposing them –Junior minister from the partner party Hypothesis: we expect the presence of a partner party in the ministry drafting a bill to reduce the number of changes made to the bill in the legislature –Number of committee referrals Hypothesis: we expect to see more changes made to bills, other things equal, the greater the number of committees involved in the review process (ie the greater the number of legislators from a party who are able to scrutinize a minitser’s proposal) –Number of articles in the draft bill (logged) Hypothesis: we would expect a positive relation between the number of draft articles and the number of articles changed –Expiration of bill before the plenary vote Hypothesis: bills that do not reach the final voting stage are not changed as extensively as bills that receive a full review in the legislative process –Country indicator variable Hypothesis: since in Germany (but not in Netherlands) committees has redrafting authority, we expect more extensive changes being made in Germany –Policy area indicators Bills dealing with certain types of issues might be always changed more or less extensively, regardless of the policy preferences of coalition partners

METHODOLOGY Event count model Assumptions: -The events accumulating during the observation period are conditionally independent -The rate of event occurrence is homogeneous across any given time period Violated: positive contagion  overdispersion Solution: negative binomial analysis Allows the rate of event occurrence to vary across an observation period And allows for estimation of the degree of overdispersion as a parameter from the data

RESULTS

Government issue divisiveness Hypothesis: bills dealing with issues that are more divisive for the coalition government are changed more extensively in the legislative process ok Control variables: –Opposition issue divisiveness Hypothesis: if the opposition does possess significant influence over policymaking, we should expect more changes being made to those bills dealing with issues that greatly divide opposition parties from the party of the minister proposing them not supported –Junior minister from the partner party Hypothesis: we expect the presence of a partner party in the ministry drafting a bill to reduce the number of chenges made to the bill in the legislature ok –Number of committee referrals Hypothesis: we expect to see more changes made to bills, other things equal, the greater the number of committees involved in the review process (ie the greater the number of legislators from a party who are able to scrutinize a minitser’s proposal) ok –Number of articles in the draft bill (logged) Hypothesis: we would expect a positive relation between the number of draft articles and the number of articles changed ok –Expiration of bill before the plenary vote Hypothesis: bills that do not reach the final voting stage are not changed as extensively as bills that receive a full review in the legislative process ok –Country indicator variable Hypothesis: since in Germany (but not in Netherlands) committees has redrafting authority, we expect more extensive changes being made in Germany ok, but be careful –Policy area indicators Bills dealing with certain types of issues might be always changed more or less extensively, regardless of the policy preferences of coalition partners not displayed

Predictive results How do different levels of coalition policy divergence affect the predicted number of article changes in government bills?

Predictive results

CONCLUSION Role of legislatures in parliamentary democracies policymaking Central role of the legislative process in strenghtening government (not opposition) parties Delegation creates tensions between coalition parties that grow particularly strong on issues that sharply divide them Coalition partners attempt to manage these tensions trough both cabinet-level and legislative-level institutions Ministerial drafts are likely to be changed more extensively in the legislative process the greater the level of policy divisiveness among coalition partners Parliament as an arena in which coalition parties interact

Possible extensions 1.Minority governments Do the preferences of opposition parties matter? And to what degree? 2.Multiparty governments in majoritarian systems Cabinet–level institutions and/or “ministerial autonomy”