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A Voting Model of Federal Standards with Externalities

Crémer, Jacques and Palfrey, Thomas R. (2003) A Voting Model of Federal Standards with Externalities. Social Science Working Paper, 1171. California Institute of Technology , Pasadena, CA. (Unpublished)

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This paper proposes a framework for studying policy making in a federal system in the presence of spillover externalities. Local jurisdictions choose local policies by majority rule subject to standards that are set by majority rule at the federal level. We characterize the induced preferences of voters for federal policies, prove existence of local majority rule equilibrium, provide an example of nonexistence of global majority rule equilibrium, and explore the welfare properties of federal standards in the presence of spillovers.

Item Type:Report or Paper (Working Paper)
Palfrey, Thomas R.0000-0003-0769-8109
Additional Information:Revised version. Original dated to April 29, 2003. We are grateful to LEESP, CNRS, and NSF for financial support. The paper has benefited from discussions with and comments from Jenna Bednar, Antoine Loeper, Hervé Moulin, Norman Schofield, and Barry Weingast. We also wish to acknowledge comments from seminar participants at California Institute of Technology, Harvard University, London School of Economics, New York University, Ohio State University, Princeton University, University of Aix Marseille, University of Malaga, University of Pennsylvania, University of Toulouse, Williams College, and the 2002 meetings of the Public Choice Society. Any remaining shortcomings are our own.
Group:Social Science Working Papers
Series Name:Social Science Working Paper
Issue or Number:1171
Record Number:CaltechAUTHORS:20170801-134757637
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Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:79698
Deposited By: Jacquelyn Bussone
Deposited On:01 Aug 2017 22:38
Last Modified:22 Nov 2019 09:58

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