Government Formation Model
Also known as: Legislative Bargaining Model, Baron-Ferejohn Model, Formateur Model, Portfolio Allocation Model
The government formation model is a non-cooperative bargaining theory explaining how a cabinet and the division of its portfolios emerge when no party holds a majority. In the canonical Baron-Ferejohn (1989) framework, a head of state or chance mechanism recognizes one party as formateur with a probability often proportional to its seat share; the formateur proposes a government and an allocation of the spoils of office, and the proposal takes effect only if a legislative majority accepts. Austen-Smith and Banks (1988) embed this in an electoral and coalition setting. The model's signature result is a proposer (formateur) advantage: the party that gets to propose secures a disproportionate share of portfolios.
Key highlights
- Explains both coalition selection and the division of portfolios within a single, fully strategic non-cooperative model.
- Generates the empirically important proposer-advantage prediction and a clear comparative static in the discount factor.
- Provides explicit micro-foundations for government-formation duration, formateur choice, and the bargaining process.
- Complements cooperative coalition theory by endogenizing how one feasible coalition is actually chosen.
Intuition
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How it works
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When to use it
Use the government formation model when you want to explain not just which coalition forms but how the offices and spoils are divided, and when the sequence and bargaining power of negotiation matter — especially the advantage of the party that proposes. It is the appropriate tool for studying formateur selection, the duration and difficulty of government formation, portfolio payoffs, and minority or surplus governments that arise from strategic bargaining rather than pure coalition arithmetic. It pairs naturally with coalition formation analysis, which characterizes the set of attractive coalitions, whereas this model explains how one of them is actually selected and how the pie is split. It is less suited when office spoils are indivisible or lumpy in ways the divide-the-dollar setup ignores, or when policy considerations dominate office payoffs, in which case spatial and policy-bargaining extensions are needed.
Strengths & limitations
- Explains both coalition selection and the division of portfolios within a single, fully strategic non-cooperative model.
- Generates the empirically important proposer-advantage prediction and a clear comparative static in the discount factor.
- Provides explicit micro-foundations for government-formation duration, formateur choice, and the bargaining process.
- Complements cooperative coalition theory by endogenizing how one feasible coalition is actually chosen.
- The benchmark divide-the-dollar setup treats spoils as perfectly divisible, abstracting from the lumpy, qualitatively distinct nature of real ministries.
- Predicted proposer advantage is often larger than the near-proportional (Gamson's Law) split observed in many empirical portfolio allocations.
- Equilibria can be sensitive to the recognition rule, protocol, and discount-factor assumptions, which are hard to observe directly.
- Pure office-bargaining versions downplay policy congruence, which clearly constrains who governs together in practice.
Common pitfalls
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Applications
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Frequently asked
What is the proposer (formateur) advantage and why does it arise?
The proposer advantage is the result that the party recognized to make the first offer secures a share of office spoils larger than its seat share. It arises because bargaining is costly and parties are impatient: every other party slightly prefers an acceptable offer now to the discounted, uncertain prospect of bargaining again. The formateur exploits this by offering each needed partner just its continuation value — the minimum it will accept — and keeping the surplus. The advantage grows the more impatient the parties are (the lower the discount factor).
How does the model relate to Gamson's Law of proportional portfolio allocation?
Gamson's Law is the strong empirical regularity that coalition partners receive cabinet portfolios in close proportion to the seats they bring. The Baron-Ferejohn bargaining model instead predicts a first-mover premium for the formateur, which seems to conflict with proportionality. The tension is partly resolved by features the simple model omits: repeated interaction, reputational concerns, policy bargaining, and the lumpiness of real portfolios all push observed allocations toward proportionality, while the formateur's advantage often shows up in securing the most valuable posts rather than a larger raw count.
How does the government formation model differ from coalition formation analysis?
Coalition formation analysis is a cooperative-game approach that classifies which subsets of parties are winning, minimal, smallest, or ideologically connected, characterizing the set of attractive coalitions from seat shares and positions. The government formation model is a non-cooperative, sequential bargaining theory that explains how one coalition is actually selected — through formateur recognition, proposal, and acceptance — and how the portfolios are divided, generating the proposer advantage. Coalition theory answers 'which coalitions are viable'; the bargaining model answers 'which one forms and who gets what.'
Sources
- 1.Baron, D. P., & Ferejohn, J. A. (1989). Bargaining in Legislatures. American Political Science Review, 83(4), 1181-1206.
- 2.Austen-Smith, D., & Banks, J. (1988). Elections, Coalitions, and Legislative Outcomes. American Political Science Review, 82(2), 405-422.
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ScholarGate. (2026, June 22). Government Formation Model. ScholarGate. https://scholargate.app/political-economy/government-formation-model