Lecture+4+September+16

Lecture+4+September+16 - Today in Comparative Politics •...

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Unformatted text preview: Today in Comparative Politics • Exit, voice, and loyalty game, continued • Backward induction and subgame perfect Nash equilibria • What is a state? • Weber • Tilly • North Announcements • First homework has been posted on Sakai with an email alert • Due in next recitation section, September 23-25 • First geography quiz next Monday • Covers Western Europe Exit, voice, and loyalty game • Value of benefit transferred to state = 1 • Citizen’s cost of voice = c • Citizen’s exit payoff = E • State’s loyalty payoff = L Loyalty < 1 − c The values of exit and loyalty • How valuable is loyalty to the state? • L > 1 : Citizen’s loyalty is more valuable than the expropriated benefit. State is dependent . • L < 1 : Citizen’s loyalty is less valuable than the expropriated benefit. State is autonomous . • How attractive is the citizen’s option to exit? • E > 0 : Citizen prefers exit to loyalty. Exit payoff is greater than loyalty payoff. Exit is an attractive option . • E < 0 : Citizen prefers loyalty to exit. Exit payoff is greater than loyalty payoff. Exit is not an attractive option. Four scenarios to consider Exit is unattractive Exit is attractive State is autonomous State is dependent Case 4 E < 0; L < 1 Case 3 E > 0; L < 1 Case 2 E < 0; L > 1 Case 1 E > 0; L > 1 Case 1: Citizen exit is attractive ( E > 0 ) and the state is dependent ( L > 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Backward- induction equilibrium: (V, E), R Equilibrium payoffs: 1 − c; L Case 2: Citizen exit is not attractive ( E < 0 ) and the state is dependent ( L > 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 2: Citizen exit is not attractive ( E < 0 ) and the state is dependent ( L > 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 2: Citizen exit is not attractive ( E < 0 ) and the state is dependent ( L > 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 2: Citizen exit is not attractive ( E < 0 ) and the state is dependent ( L > 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Backward- induction equilibrium: (L, L), I Equilibrium payoffs: 0; 1 + L Case 3: Citizen exit is attractive ( E > 0 ) and the state is autonomous ( L < 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 3: Citizen exit is attractive ( E > 0 ) and the state is autonomous ( L < 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 3: Citizen exit is attractive ( E > 0 ) and the state is autonomous ( L < 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 3: Citizen exit is attractive ( E > 0 ) and the state is autonomous ( L < 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Backward- induction equilibrium: (E, E), I Equilibrium payoffs: E; 1 Case 4: Citizen exit is not attractive ( E < 0 ) and the state is autonomous ( L < 1 ) Loyalty 0 ; 1 + L E ; 1 1 – c ; L – c ; 1 + L E – c ; 1 Case 4: Citizen exit is...
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Lecture+4+September+16 - Today in Comparative Politics •...

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