Democracy Undone - Systematic Minority Advantage in Competitive Vote Markets

74 Pages Posted: 1 Feb 2013

See all articles by Alessandra Casella

Alessandra Casella

Columbia University - Graduate School of Arts and Sciences, Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Sebastien Turban

California Institute of Technology - Economics

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Date Written: December 2012

Abstract

We study the competitive equilibrium of a market for votes where voters can trade votes for a numeraire before making a decision via majority rule. The choice is binary and the number of supporters of either alternative is known. We identify a sufficient condition guaranteeing the existence of an ex ante equilibrium. In equilibrium, only the most intense voter on each side demands votes and each demand enough votes to alone control a majority. The probability of a minority victory is independent of the size of the minority and converges to one half, for any minority size, when the electorate is arbitrarily large. In a large electorate, the numerical advantage of the majority becomes irrelevant: democracy is undone by the market.

Keywords: majority voting, minority, vote buying, vote trading, voting

JEL Classification: C62, C72, D70, D72, P16

Suggested Citation

Casella, Alessandra and Turban, Sebastien, Democracy Undone - Systematic Minority Advantage in Competitive Vote Markets (December 2012). CEPR Discussion Paper No. DP9242, Available at SSRN: https://ssrn.com/abstract=2210211

Alessandra Casella (Contact Author)

Columbia University - Graduate School of Arts and Sciences, Department of Economics ( email )

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Centre for Economic Policy Research (CEPR)

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National Bureau of Economic Research (NBER)

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Sebastien Turban

California Institute of Technology - Economics ( email )

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