in the first place.Journal of Economic Literature Classification Numbers: D72, D78,

This paper examines the institutional determinants of discipline in legislative par-ties. The model formalizes the tradeoff between resources at the leaders discretion, and the incumbents need to maintain a minimum level of support to continue leading. The value of the incumbent leader’s promises of future benefits is here endogenously determined by the backbenchers ’ beliefs about the extent of support to the incum-bent among other party legislators. Rewards that can be distributed publicly and on the spot are effective tools to coordinate beliefs about the stability of the leader, and thus also increase the value of the incumbent’s promises of future benefits. These spot resources are in fact necessary for the incumbent to be powerful: without them, the incumbent can use promises of future benefits to sway members ’ behavior only if a majority of the party agrees (ex ante) with the incumbent’s preferred positio