The Market for Votes: Coasian Bargaining in an Arrovian Setting

George Mason Law Review, 1998

Posted: 21 Jul 1997

See all articles by Francesco Parisi

Francesco Parisi

University of Minnesota - Law School; University of Bologna

Date Written: July 1997

Abstract

This paper shows how Arrow's (1951) possibility theorem is modified by allowing bargaining and side-payments across members of majority and minority coalitions. Under fairly plausible conditions, the outcome will be stable and unique. If voters have similar utility functions centered around different ideal policy points, then the bargaining will be conducive to the "center of mass" of the policy triangle. Such an outcome will satisfy both the Benthamite and the Nash criteria of social welfare. If voters have differently- shaped utility functions, the Benthamite and Nash optimal points will not coincide, and the bargaining outcome will only satisfy the Benthamite criterion.

Suggested Citation

Parisi, Francesco, The Market for Votes: Coasian Bargaining in an Arrovian Setting (July 1997). George Mason Law Review, 1998. Available at SSRN: https://ssrn.com/abstract=10527

Francesco Parisi (Contact Author)

University of Minnesota - Law School ( email )

229 19th Avenue South
Minneapolis, MN 55455
United States

University of Bologna ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

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