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Does Vote Trading Improve Welfare?

Author

Listed:
  • Alessandra Casella

    (Departments of Economics and Political Science, Columbia University, New York, NY 10027, USA)

  • Antonin Macé

    (Economics Department, École Normale Supérieure, 75230 Paris, France)

Abstract

Voters have strong incentives to increase their influence by trading votes, acquiring others’ votes when preferences are strong in exchange for giving votes away when preferences are weak. But is vote trading welfare improving or welfare decreasing? For a practice long believed to be central to collective decisions, the lack of a clear answer is surprising. We review the theoretical literature and, when available, its related experimental tests. We begin with the analysis of logrolling, the exchange of votes for votes. We then focus on vote markets, where votes can be traded against a numeraire. We conclude with procedures allowing voters to shift votes across decisions—that is, allowing one to trade votes with oneself only. We find that vote trading and vote markets are typically inefficient; more encouraging results are obtained by allowing voters to allocate votes across decisions.

Suggested Citation

  • Alessandra Casella & Antonin Macé, 2021. "Does Vote Trading Improve Welfare?," Annual Review of Economics, Annual Reviews, vol. 13(1), pages 57-86, August.
    • Handle: RePEc:anr:reveco:v:13:y:2021:p:57-86
    DOI: 10.1146/annurev-economics-081720-114422
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    1. Anand Murugesan & Jean-Robert Tyran, 2023. "The Puzzling Practice of Paying “Cash for Votes”," CESifo Working Paper Series 10504, CESifo.
    2. Ali Lazrak & Jianfeng Zhang, 2023. "Democratic Policy Decisions with Decentralized Promises Contingent on Vote Outcome," Papers 2304.08008, arXiv.org, revised Jul 2023.
    3. Dimitrios Xefteris & Nicholas Ziros, 2024. "The “invisible hand” of vote markets," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 62(1), pages 153-165, February.
    4. Hayrullah Dindar & Jean Lainé, 2022. "Compromise in combinatorial vote," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 59(1), pages 175-206, July.
    5. Hans Gersbach, 2022. "New Forms of Democracy," CESifo Working Paper Series 10134, CESifo.

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    More about this item

    Keywords

    logrolling; vote trading; storable votes; quadratic voting; bundling; vote markets;
    All these keywords.

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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