Coalition Termination and the Strategic Timing of Parliamentary Elections

Cabinet coalitions in multiparty parliamentary democracies lead a precarious existence. Legislative majorities can typically dismiss the cabinet at will and can sometimes force early elections through parliamentary dissolution. Since coalition termination can have substantial political consequences, it is important to understand when and why such decisions are made. To this end, we develop a model of coalition bargaining in a legislature with dismissal and dissolution powers. We use the model to identify necessary and sufficient conditions for both coalition termination and parliamentary dissolution. In contrast to several widely held maxims, we find that coalition terminations need not be the automatic consequence of exogenous shocks. Nor do opportunistic parties with favorable electoral prospects always dissolve parliament to enhance their power. Instead, decisions to terminate coalitions or call new elections result from party leaders' rational responses to the constraints of legislative and electoral institutions and the anticipated feelings of the electorate.