Taxes, Budgetary Rule and Majority Voting
AbstractThis paper studies majority voting outcomes for a specific class of two-dimensional policies. One policy instrument influences efficiency and the other redistribution. Absent the political process, the two dimensions can be addressed separately. With a two dimensional vote, the two aspects will interact in a non-trivial way. The illustrative policy we consider, requires taxing an externality-generating good and determining a budgetary rule which specifies the proportions of the tax proceeds that go to wage earners and to capital owners. We show: First, a sequential vote wherein the tax rate is determined first and the budgetary rule second, always possesses an equilibrium and that this equilibrium is the median-endowed individual's most-preferred policy. Second, the reverse sequential choice implies that the median-endowed individual may, but need not, be decisive. Third, the ``Shepsle procedure'' also implies that the equilibrium is the policy most favored by the median individual. Fourth, this equilibrium constitutes, under certain circumstances, the Condorcet winner for the unrestricted simultaneous voting game.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Springer in its journal Public Choice.
Volume (Year): 119 (2004)
Issue (Month): 3_4 (06)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100332
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Vincent Anesi & Philippe De Donder, 2011.
"Secondary issues and party politics: an application to environmental policy,"
Social Choice and Welfare,
Springer, vol. 36(3), pages 519-546, April.
- Anesi, Vincent & De Donder, Philippe, 2008. "Secondary Issues and Party Politics: An Application to Environmental Policy," CEPR Discussion Papers 6774, C.E.P.R. Discussion Papers.
- De Donder, Philippe & Le Breton, Michel & Peluso, Eugenio, 2010.
"Majority Voting in Multidimensional Policy Spaces: Kramer-Shepsle versus Stackelberg,"
CEPR Discussion Papers
7646, C.E.P.R. Discussion Papers.
- Philippe De Donder & Michel Le Breton & Eugenio Peluso, 2012. "Majority Voting in Multidimensional Policy Spaces: Kramer–Shepsle versus Stackelberg," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(6), pages 879-909, December.
- De Donder, Philippe & Le Breton, Michel & Peluso, Eugenio, 2010. "Majority Voting in Multidimensional Policy Spaces: Kramer-Shepsle versus Stackelberg," IDEI Working Papers 593, Institut d'Économie Industrielle (IDEI), Toulouse.
- Fredriksson, Per G. & Wang, Le & Mamun, Khawaja A., 2011. "Are politicians office or policy motivated? The case of U.S. governors' environmental policies," Journal of Environmental Economics and Management, Elsevier, vol. 62(2), pages 241-253, September.
- Cremer, Helmuth & De Donder, Philippe & Gahvari, Firouz, 2005.
"Political Competition within and between Parties: An Application to Environmental Policy,"
IDEI Working Papers
358, Institut d'Économie Industrielle (IDEI), Toulouse.
- Cremer, Helmuth & De Donder, Philippe & Gahvari, Firouz, 2008. "Political competition within and between parties: An application to environmental policy," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 532-547, April.
- Cremer, Helmuth & De Donder, Philippe & Gahvari, Firouz, 2005. "Political competition within and between parties: an application to environmental policy," CEPR Discussion Papers 5228, C.E.P.R. Discussion Papers.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.