Optimal Democratic Mechanisms: Should Minorities Propose First?

34 Pages Posted: 12 Apr 2024

See all articles by Hans Gersbach

Hans Gersbach

ETH Zurich - CER-ETH -Center of Economic Research; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Stephan Imhof

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich

Oriol Tejada

University of Barcelona

Date Written: March 14, 2024

Abstract

We study optimal democratic procedures for public project provision, financing, and redistribution under democratic constraints. We show that the four features that define the following procedure are essential for optimality: (i) there are two proposal-making rounds followed by a voting round (with the majority rule); (ii) a member of the minority proposes first and a member of the majority proposes second;(iii) taxes are uniform;(iv) subsidies are fixed for agenda-setters. Our insights rationalize the principle according to which minorities should always propose first.

Keywords: constitutional design, public project provision, subsidies, majority rule

JEL Classification: D72, H40

Suggested Citation

Gersbach, Hans and Imhof, Stephan and Tejada, Oriol, Optimal Democratic Mechanisms: Should Minorities Propose First? (March 14, 2024). Available at SSRN: https://ssrn.com/abstract=4759227 or http://dx.doi.org/10.2139/ssrn.4759227

Hans Gersbach

ETH Zurich - CER-ETH -Center of Economic Research ( email )

Zürichbergstrasse 18
Zurich, 8092
Switzerland
+41 44 632 82 80 (Phone)
+41 44 632 18 30 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Stephan Imhof

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich ( email )

Zürichbergstrasse 18
Zurich, 8092
Switzerland

Oriol Tejada (Contact Author)

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

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