Game Theory Explains Coalition Talks Dynamics

Political maneuvering in coalition negotiations, characterized by public statements, leaks, and rejections, is a strategy to engage the public, according to Assaf Halami, an expert on game theory and a political science researcher. He explains that politicians must prioritize their campaign promises and calculate the "audience costs", the public's reaction to their decisions, to determine the consequences of not fulfilling commitments. This calculation influences how they approach negotiations, even after elections.

Halami suggests that the true power in negotiations isn't solely determined by the number of mandates a party holds. A party whose support is essential for forming a government can wield veto power and demand significant concessions, similar to Bennett's role in the previous "change government." However, a party's bargaining power also depends on its ability to credibly threaten to walk away from a deal. Parties lacking alternatives struggle to pressure their sole potential partner.

He identifies the right-wing parties, Otzma and Tzionut, as the weakest negotiators in the current context due to their lack of leverage with Netanyahu and their inability to join the opposition bloc. Conversely, the possibility of Yahadut HaTorah supporting a government led by Izencoat could strengthen its bargaining position with Netanyahu, making its support less of a given.

Halami points to a "blind spot" regarding the mandates from parties representing Arab citizens, noting that coalition analyses have long indicated their necessity for forming an opposition bloc government. He suggests that had the leaders of the "change bloc" recognized this, they might have used more diplomatic language or made less definitive commitments. Netanyahu's "Right or Palestine" campaign, while complicating the formation of a minority government, could also benefit Bennett and Lieberman by allowing them to demand more significant achievements from Izencoat to justify compromises to their voters.

The expert likens the difficulty in reaching an agreement to the "prisoner's dilemma," where individual attempts to improve one's position can lead to a worse outcome for all. He emphasizes that in negotiations, where information is incomplete, parties must make assumptions, minimize potential damage, and manage their audience costs for political survival. Halami estimates a roughly 60% probability that Netanyahu will remain prime minister, either through a transitional government, repeat elections, or a narrow right-wing government, with the remaining probability for a unity government under his leadership or a coalition with defectors from the "change bloc."