[jbooth]

Doesn't the game theory for this sort of always point to the last, smallest member to join the coalition gets to make the most demands relative to it's size?

If it's get my party with it's 4 seats on board or fail and hold new elections, I can make demands way in excess of what those 4 seats should get me, right? And then once the government's installed, why not just hold them hostage again?

I mean, assuming your parliamentarians have no sense of shame. Maybe that's my bias from watching American legislators.

[ronaldx]

In some circumstances, yes, but in general, no: game theory doesn't say that.

If the coalition's large parties have alternative small parties to choose from, the smallest party has to compete for entrance with the other smallest parties.

This 'reverse auction' makes it possible that a small party would end up with net 0 power when the right to govern is taken into account (could be itself negative).

An agreement that excludes a new election from being called should be possible at this point (e.g. Conservative-Liberal Democrat coalition agreement).

The fact that we normally observe smallest members having outsized power might be explained by, e.g.: 1) Coalition in a two/three-party Westminster-style system tends to mean the third party is essential and doesn't have competition 2) Regression to the mean: we would observe this anyway if power in coalition was independent of party size.

[Svip]

Some of the support parties have tried that, and have been shut out, so the government reaches across the aisle on certain laws. Our previous government tend to do the budget with the opposition party rather than their support party, for these reasons. And the same with our current government.

The only problem is that if the government cannot find an agreement across the aisle, they have to go to their fringe support party. So the opposition always have to wager this when negotiating. If they don't want to find an agreement with the government, the result might be worse than a compromise. So it is an advantage to the government in negotiating positions sometimes.

[Ras_]

Makes sense. In Finland the only constant between parliaments seems to be the Swedish People's Party. One or two cabinet seats since 1979 (support ranging from 4.2 to 5.5%). They basically exist to maintain the Swedish language's position in Finland. Since their demands are predictable and relatively trivial, they end up in all combinations, even the current mongrel six-party coalition.