Casella, Alexandra and Llorente-Saguer, Aniol and Palfrey, Thomas R. (2010) Competitive Equilibrium in Markets for Votes. Social Science Working Paper, 1331. California Institute of Technology , Pasadena, CA. http://resolver.caltech.edu/CaltechAUTHORS:20100924-163224980
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We develop a competitive equilibrium theory of a market for votes. Before voting on a binary issue, individuals may buy and sell their votes with each other. We definne ex ante vote-trading equilibrium, identify weak sufficient conditions for existence, and construct one such equilibrium. We show that this equilibrium must always result in dictatorship and the market generates welfare losses, relative to simple majority voting, if the committee is large enough. We test the theoretical implications by implementing a competitive vote market in the laboratory using a continuous open-book multi-unit double auction.
|Item Type:||Report or Paper (Working Paper)|
|Group:||Social Science Working Papers|
|Subject Keywords:||Voting, Markets, Vote Trading, Experiments, Competitive Equilibrium|
|Classification Code:||JEL Classi cation: C72, C92, D70, P16|
|Usage Policy:||No commercial reproduction, distribution, display or performance rights in this work are provided.|
|Deposited By:||Katherine Johnson|
|Deposited On:||27 Sep 2010 18:20|
|Last Modified:||26 Dec 2012 12:27|
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