ECONOMIC ANALYSIS OF POLITICAL INSTITUTIONS : AN INTRODUCTION by Roger

This paper surveys four game-theoretic models of politics, to offer an introduction to the analysis of political institutions. The first two models focus on electoral competition, to show how successful candidates' equilibrium strategies may differ under different electoral systems. The other two models probe the consequences of legislative bargaining under different constitutional structures. Introduction The phrase "political economy" has come to mean very different things in different places. In political science departments, it generally means the study of how economic forces affect politics. As such, the phrase often has a Marxist implication, because of the particular importance that Marxist theory places on economic forces for explaining political events. In economics departments, however, political economy is often taken to mean the study of political forces that affect economic activity. In classical social philosophy, the study of markets was not so separate from the study of government. The phrase "political economy" was taken from Greek words meaning "housekeeping of city-states," and it was applied to describe the study of how civilized societies are organized. So the classical goal of political economy was to explain the functioning of all social institutions. The successful development of price theory forced a separation between the study of