Multiparty government in parliamentary democracies entails bargaining over the payoffs of government participation, in particular the allocation of cabinet positions. While most of the literature deals with the numerical distribution of cabinet seats among government parties, this article explores the distribution of individual portfolios. It argues that coalition negotiations are sequential choice processes that begin with the allocation of those portfolios most important to the bargaining parties. This induces conditionality in the bargaining process as choices of individual cabinet positions are not independent of each other. Linking this sequential logic with party preferences for individual cabinet positions, the authors of the article study the allocation of individual portfolios for 146 coalition governments in Western and Central Eastern Europe. The results suggest that a sequential logic in the bargaining process results in better predictions than assuming mutual independence in the distribution of individual portfolios.

The assignment of ministerial portfolios to parties is one of the most contested and consequential processes in coalition politics. Accordingly, a great deal of scholarship has investigated how many portfolios different parties obtain in coalition negotiations as well as which parties are assigned which portfolios. However, to our knowledge, no one has ever examined how voters perceive the outcomes of this process – perceptions which must be fundamental to any assessment of policy responsibility in systems with coalition government. This article uses original survey data from four Western European countries to examine voter perceptions of the distribution of cabinet portfolios across parties. In addition to describing the extent to which voters know this distribution, the article also examines whether their perceptions are consistent with a number of different heuristics that voters might use to infer characteristics of the cabinet portfolio distribution. The results suggest that many voters use party role and size heuristics to infer the number of portfolios allocated to different parties as well as an ‘importance rule’, a ‘topical affinity rule’ and a ‘historical regularity rule’ to infer which parties hold which portfolios, but also that a significant number of voters have direct knowledge (not inferred using heuristics) of which parties hold which ministries.

Ministerial portfolios are the most obvious payoffs for parties entering a governing coalition in parliamentary democracies. This renders the bargaining over portfolios an important phase of the government formation process. The question of ‘who gets what, and why?’ in terms of ministerial remits has not yet received much attention by coalition or party scholars. This article focuses on this qualitative aspect of portfolio allocation and uses a new comparative dataset to evaluate a number of hypotheses that can be drawn from the literature. The main hypothesis is that parties which, in their election manifestos, emphasise themes corresponding to the policy remit of specific cabinet portfolios are more likely to obtain control over these portfolios. The results show that policy saliency is indeed an important predictor of portfolio allocation in postwar Western European parliamentary democracies.

This article explores processes of coalition governance in foreign policy. Specifically, it argues that such processes are shaped by two interrelated dimensions of coalition set-up: first, the allocation of the foreign ministry to the senior or a junior coalition partner and, second, the degree of policy discretion which is delegated to that ministry. Bringing these two dimensions together, the article distinguishes four types of coalition arrangement for the making of foreign policy, which are expected to have predictable implications for the process of foreign policy-making and, ultimately, for the foreign policy outputs of multi-party coalitions and their quality.

While all government portfolios used to be the purview of men exclusively, more and more women are selected to sit around the cabinet table. But under which circumstances do women get appointed to different ministerial portfolios? This article, proposes a theoretical framework to consider how party leaders’ attitudes and motivations influence the allocation of portfolios to male and female ministers. These propositions are tested empirically by bringing together data on 7,005 cabinet appointments across 29 European countries from the late 1980s until 2014. Considering the key partisan dynamics of the ministerial selection process, it is found that women are significantly less likely to be appointed to the ‘core’ offices of state, and ‘masculine’ and ‘neutral’ policy areas. However, these gender differences are moderated by the ideology of the party that allocates them. Women are more likely to be appointed to ‘masculine’ portfolios when a party's voters have more progressive gender attitudes. This theoretical framework and analysis enhances our understanding of women's access to the government, which has important implications for how ministers are selected, as well as how women are represented in the most powerful policy‐making positions in Europe.

This article investigates the dynamics of portfolio allocation within political parties to shed light on the patterns of conflict and cooperation between rival party factions. It provides a game‐theoretic model that helps in explaining differences in portfolio allocation due to alternative modes of party organisation or party system competitiveness. Focusing on party congresses to estimate the number, strength and policy positions of party factions, the Italian case is analysed by testing some hypotheses generated by the theoretical model. The results shown that, overall, spoils are shared in proportion to the strength of each faction, in line with the prediction of Gamson's Law. However, there are also some important deviations from this path. Rules that foster party leaders' autonomy in fact provide them with a higher degree of discretion that will be used to reward their followers and to ward off any credible and harmful threat to party unity. Indeed, strategic portfolio allocation might balance out a lower amount of policy payoffs and becomes a strategy to restrain minorities from breaking away, thus contributing to the preservation of party unity in highly competitive political systems.

This paper investigates a well-known downside protection strategy called the constant proportion portfolio insurance (CPPI) in defined contribution (DC) pension fund modeling. Under discrete time trading CPPI, an investor faces the risk of portfolio value hitting the floor which denotes the process of guaranteed portfolio values. In this paper, we question how to deal with so-called ‘gap risk’ which may appear due to uncontrollable events resulting in a sudden drop in the market. In the market model considered, the risky asset price and the labor income are assumed to be continuous-time stochastic processes, whereas trading is restricted to discrete-time. In this setting, an exotic option (namely, the ‘cushion option’) is proposed with the aim of reducing the risk that the portfolio value falls below the defined floor. We analyze the effectiveness of the proposed exotic option for a DC plan CPPI strategy through Monte Carlo simulations and sensitivity analyses with respect to the parameters reflecting different setups.

Recent research suggests that party leaders can strategically impact the perceived left–right position of their parties by changing their selective emphasis on certain issues. We suggest that a party's ideological image can also be altered by the portfolio allocation of the coalition government in which the party participates. By controlling a portfolio, the party will have a more direct influence on the related issue and will frequently communicate the party's issue position publicly, thereby cultivating a perception of strong emphasis on the related issue. We run a cross-national party-level analysis showing that portfolio allocation matters with regard to the importance of the subdimensions for the general left–right dimension. In particular, the influence of sociocultural stances depends on the share of sociocultural portfolios. In addition, we show that the mechanism does not apply at the beginning of a government's tenure, but only after a year or longer in office.

Ministerial portfolios that promise high status, broad public visibility, and extensive financial and personnel resources continue to be men's domains. In this article, we shed light on gender inequality in ministerial selection processes by studying the duration from a minister's original appointment as a member of cabinet until he or she receives responsibility for a highly prestigious portfolio. We argue that the time it takes for ambitious politicians to prove themselves suitable for this type of cabinet position depends on their sex and the degree to which the policy area for which they are responsible reinforces stereotypical expectations about their personality traits. Empirical evidence from event history analysis of original data including detailed information on all ministerial careers in 27 European countries between 1990 to 2018 supports these propositions. These findings reveal that even highly qualified women politicians who are already members of the executive face additional barriers during their political careers.

Target-date funds in corporate retirement plans grew from $5 billion in 2000 to $734 billion in 2018, partly because federal regulation sanctioned these as default investments in automatic enrollment plans. We show that adopters delegated pension investment decisions to fund managers selected by plan sponsors. Inclusion of these funds in retirement saving menus raised equity shares, boosted bond exposures, curtailed cash/company stock holdings, and reduced idiosyncratic risk. The adoption of low-cost target-date funds may enhance retirement wealth by as much as 50% over a 30-year horizon.

The design of government portfolios – that is, the distribution of competencies among government ministries and office holders – has been largely ignored in the study of executive and coalition politics. This article argues that portfolio design is a substantively and theoretically relevant phenomenon that has major implications for the study of institutional design and coalition politics. The authors use comparative data on portfolio design reforms in nine Western European countries since the 1970s to demonstrate how the design of government portfolios changes over time. Specifically, they show that portfolios are changed frequently (on average about once a year) and that such shifts are more likely after changes in the prime ministership or the party composition of the government. These findings suggest a political logic behind these reforms based on the preferences and power of political parties and politicians. They have major implications for the study of institutional design and coalition politics.

In coalition governments, political parties are concerned not only with how many but also with which departments they control. The foreign ministry is among the most highly considered prizes in coalition negotiations. This article develops hypotheses to explain under which conditions the foreign ministry is likely to be allocated to a ‘junior coalition partner’. The factors that are hypothesized to affect the allocation are: the relative size of coalition parties; the proximity of their foreign policy positions; the party family of the junior coalition party; the salience of foreign policy to the coalition parties; and past allocations of the foreign ministry to junior coalition partners. Employing a crisp-set qualitative comparative analysis, the article demonstrates that although the conjunction of the junior partner being relatively large and it having led the foreign ministry in the past is not sufficient by itself, those two factors are very influential in the junior partner being allocated the foreign ministry.

How do the president's calculations in achieving policygoals shape the allocation of cabinet portfolios?Despite the growing literature on presidentialcabinet appointments, this question has barely beenaddressed. I argue that cabinet appointments arestrongly affected not only by presidentialincentives to effectively deliver their key policycommitments but also by their interest in havingtheir administration maintain strong politicalleverage. Through an analysis of portfolioallocations in South Korea after democratization, Idemonstrate that the posts wherein ministers caninfluence the government's overall reputationtypically go to nonpartisan professionalsideologically aligned with presidents, while theposts wherein ministers can exert legislators'influence generally go to senior copartisans. Myfindings highlight a critical difference inpresidential portfolio allocation from parliamentarydemocracies, where key posts tend to be reserved forsenior parliamentarians from the ruling party.

The growth and popularity of defined contribution pensions, along with the government's increasing attention to retirement plan costs and investment choices provided, make it important to understand how people select their retirement plan investments. This paper shows how employees in a large firm altered their fund allocations when the employer streamlined its pension fund menu and deleted nearly half of the offered funds. Using administrative data, we examine the changes in plan participant investment choices that resulted from the streamlining and how these changes might affect participants’ eventual retirement wellbeing. We show that streamlined participants’ new allocations exhibited significantly lower within-fund turnover rates and expense ratios, and we estimate this could lead to aggregate savings for these participants over a 20-year period of $20.2 M, or in excess of $9,400 per participant. Moreover, after the reform, streamlined participants’ portfolios held significantly less equity and exhibited significantly lower risks by way of reduced exposures to most systematic risk factors, compared with their non-streamlined counterparts.

How do voters attribute responsibility for government outcomes when they are the result of a collective decision taken by multiple parties within a coalition government? In this article we test the argument that in a multiparty coalition system, responsibility attribution should vary according to the quantity and quality of portfolios that the coalition partner controls. The article uses data from the Italian National Election Study in Italy, a country usually characterized by governments formed by more than two parties. We find no consistent empirical evidence that coalition parties collectively suffer from perceived negative performance. While the prime minister party is held responsible on average more than the other coalition partners, responsibility attribution decreases by party size in the parliament rather than by the quantity of ministerial portfolios the incumbent party controls. Issue saliency, however, plays an important role in the retrospective voting mechanism. These results have important implications for our understanding of electoral behaviour and democratic accountability.

Standard optimal portfolio choice models assume that investors maximise the expected utility of their future outcomes. However, behaviour which is inconsistent with the expected utility theory has often been observed.

In a discrete time setting, we provide a formal treatment of risk measures based on distortion functions that are consistent with Yaari’s dual (non-expected utility) theory of choice (1987), and set out a general layout for portfolio optimisation in this non-expected utility framework using the risk neutral computational approach.

As an application, we consider two particular risk measures. The first one is based on the PH-transform and treats the upside and downside of the risk differently. The second one, introduced by Wang (2000) uses a probability distortion operator based on the cumulative normal distribution function. Both risk measures rank-order prospects and apply a distortion function to the entire vector of probabilities.