Question 1

The Exit, Voice and Loyalty game explains the difficulty in the U.S. automakers receiving a bailout following the financial crisis compared to the financial sector by stating that the state was not dependent on the support of the automakers.

Accepted Answer

The answer of The Exit, Voice and Loyalty game explains...

Question 2

The Exit, Voice and Loyalty game explains the difficulty in the U.S. automakers receiving a bailout following the financial crisis compared to the financial sector by stating that the automakers did not have a credible exit threat.

Accepted Answer

The Exit, Voice and Loyalty game theory states that in situations where organizations or individuals have the option to exit a relationship, they are more likely to use voice to express their dissatisfaction, whereas in situations where exit is not a credible option, voice is ineffective. In the case of the U.S. automakers, they did not have a credible exit threat as they were dependent on the government and had limited options for seeking funding elsewhere, making it difficult for them to receive a bailout compared to the financial sector.

Question 3

Imagine that you are unhappy with your current job because you think you should have received a raise but your boss did not give you one. In this story, you can think of yourself as the "citizen" and your boss as the "state." According to the predictions of the Exit, Voice, and Loyalty game, in which of the scenarios shown below should you ask for a raise (that is, "use voice")?

Accepted Answer

In scenario D, you have the leverage because you can easily find another job, and your boss cannot easily replace you, making it an optimal situation to use your voice and ask for a raise.

Question 4

Above is the Exit, Voice, and Loyalty game between the state (S) and the citizen (C). E is what the citizen gets from her exit option. R is what the state gets from the support (revenue) of the citizen. 0 is what the citizen gets for remaining loyal to the state. c is the cost for the citizen of exercising her voice option.
For the following questions, let R =2. Let c = 0.25.
-Let E = 0.50. Write the payoffs for both actors in the game below. What is the subgame perfect equilibrium? Please answer in the form (citizen's 1st choice, citizen's 2nd choice; state's choice).

Accepted Answer

The answer of  Above is the Exit, Voice, and...

Question 5

Above is the Exit, Voice, and Loyalty game between the state (S) and the citizen (C). E is what the citizen gets from her exit option. R is what the state gets from the support (revenue) of the citizen. 0 is what the citizen gets for remaining loyal to the state. c is the cost for the citizen of exercising her voice option.
For the following questions, let R =2. Let c = 0.25.
-Now let E = −.25. . Write the payoffs for both actors in the game above. What is the subgame perfect equilibrium? Please answer in the form (citizen's 1st choice, citizen's 2nd choice; state's choice).

Accepted Answer

The answer of  Above is the Exit, Voice, and...

Question 6

Above is the Exit, Voice, and Loyalty game between the state (S) and the citizen (C). E is what the citizen gets from her exit option. R is what the state gets from the support (revenue) of the citizen. 0 is what the citizen gets for remaining loyal to the state. c is the cost for the citizen of exercising her voice option.
For the following questions, let R =2. Let c = 0.25.
-Given that the state depends on the citizen in this example (R > 1), to what extent does the citizen's behavior depend on the attractiveness of her exit options?

Accepted Answer

The answer of  Above is the Exit, Voice, and...

Question 7

Above is the Exit, Voice, and Loyalty game between the state (S) and the citizen (C). E is what the citizen gets from her exit option. R is what the state gets from the support (revenue) of the citizen. 0 is what the citizen gets for remaining loyal to the state. c is the cost for the citizen of exercising her voice option.
For the following questions, let R =2. Let c = 0.25.
-Given that the state depends on the citizen in this example (R > 1), to what extent does the state's behavior depend on the attractiveness of the citizen's exit options?

Accepted Answer

The answer of  Above is the Exit, Voice, and...

Quiz 2: What Is Politics

The Exit, Voice and Loyalty game explains the difficulty in the U.S. automakers receiving a bailout following the financial crisis compared to the financial sector by stating that the state was not dependent on the support of the automakers.

The Exit, Voice and Loyalty game explains the difficulty in the U.S. automakers receiving a bailout following the financial crisis compared to the financial sector by stating that the automakers did not have a credible exit threat.