Points what the ideal tax rate for voter with income

The parties are uncertain tm. All they know is that tm ∼ U[.5 − a, .5 + a], where a ≤ .5. 1. (2 points) Write the elements of this game as a Bayesian game.

2. (2 points) What is the correct solution concept for this game.

7. (3 points) Interpret the results on uncertainty empirically 8. (5 points) Show that the equilibrium must be symmetric.

9. (7 points) Now suppose there was some rent x > 0 from holding office. How does this change the equilibrium (note, based on your answer to the last question, the equilibrium should still be symmetric)
10. (3 points) Interpret this result empirically.

1. (2 points) What is the equilibrium concept we should use for this game?

2. (3 points) What is the ideal tax rate for a voter with income yi?

Pick one of the following ideas for a modified model:

• Citizen-candidate Model, with a runoff election instead of plurality (i.e., there are now two voting stages between policy selection and ).

5. (8 points) Make one of the parameters a general random variable (ex. make the cost of going to graduate school c instead of a particular value). Describe how the results change with the parameter value.

6. (5 points) How would you test this comparative static empirically? (in general terms, no need to specify a real world data set or anything)