This paper studies budget processes, both theoretically and experimentally.The authors give a sufficient condition for top-down and bottom-up budget processes to have the same voting equilibrium.

In an experimental 2x2 coordination game with two strict equilibria we observe that, in contrast to equilibrium selection theory (Harsanyi and Selten 1988), only half of the subjects choose the strategy that relates to the payoff- and risk-dominant equilibrium. We propose modified risk dominance...