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The Role of Direct Democracy in the European Union

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  • Lars P. Feld
  • Gebhard Kirchgässner

Abstract

In this paper, the introduction of direct-democratic decision-making in all EU decisions is considered when it is feasible without prohibitively increasing decision-making costs. We start with the contractarian argument that each constitution is a contract joining the citizens of a state and requires as such the explicit agreement of (a majority of) citizens. Thus, the future European Constitution as well as future changes of it should be decided by the European citizens. After a discussion of the pros and cons of direct democracy, the ability of direct democracy to help creating a European demos is discussed. Consequently, we propose a mandatory (required and binding) referendum on total and partial revisions of the European Constitution. In addition, we propose a constitutional initiative, a statutory and a general initiative as well as a fiscal referendum for financially important projects.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1083.

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Date of creation: 2003
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Handle: RePEc:ces:ceswps:_1083

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Keywords: democracy; referenda; initiatives;

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References

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  1. Matsusaka, John G, 1992. "Economics of Direct Legislation," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(2), pages 541-71, May.
  2. Buchanan, James M, 2001. "Direct Democracy, Classical Liberalism, and Constitutional Strategy," Kyklos, Wiley Blackwell, vol. 54(2-3), pages 235-42.
  3. Lars P. Feld & Gebhard Kirchgassner, 1999. "Public Debt and Budgetary Procedures: Top Down or Bottom Up? Some Evidence from Swiss Municipalities," NBER Chapters, in: Fiscal Institutions and Fiscal Performance, pages 151-180 National Bureau of Economic Research, Inc.
  4. Matsusaka, John G, 2000. "Fiscal Effects of the Voter Initiative in the First Half of the Twentieth Century," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 619-50, October.
  5. Roland Vaubel, 1996. "Constitutional safeguards against centralization in federal states: An international cross-section analysis," Constitutional Political Economy, Springer, vol. 7(2), pages 79-102, June.
  6. Peter Moser, 1996. "Why is Swiss Politics so Stable?," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), Swiss Society of Economics and Statistics (SSES), vol. 132(I), pages 31-61, March.
  7. Opp, Karl-Dieter, 1994. "The Role of Voice in a Future Europe," Kyklos, Wiley Blackwell, vol. 47(3), pages 385-402.
  8. Vaubel, Roland, 2002. "Die Politische Ökonomie des Europäischen Verfassungskonvents," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1998 - 2007), ZBW – German National Library of Economics / Leibniz Information Centre for Economics, vol. 82(10), pages 636-640.
  9. Besley, Timothy J. & Coate, Stephen, 2001. "Issue Unbundling via Citizens' initiatives," CEPR Discussion Papers 2857, C.E.P.R. Discussion Papers.
  10. Christoph A. Schaltegger & Lars P. Feld, 2001. "On Government Centralization and Budget Referendums: Evidence from Switzerland," CESifo Working Paper Series 615, CESifo Group Munich.
  11. Philippe Aghion & Jean Tirole, 1994. "Formal and Real Authority in Organizations," Working papers 95-8, Massachusetts Institute of Technology (MIT), Department of Economics.
  12. Kessler, Anke, 2003. "Representative versus Direct Democracy: The Role of Informational Asymmetries," CEPR Discussion Papers 3911, C.E.P.R. Discussion Papers.
  13. Matsusaka, John G, 1995. "Fiscal Effects of the Voter Initiative: Evidence from the Last 30 Years," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(3), pages 587-623, June.
  14. Lars P Feld & Gebhard Kirchgässner, 2001. "The political economy of direct legislation: direct democracy and local decision-making," Economic Policy, CEPR;CES;MSH, CEPR;CES;MSH, vol. 16(33), pages 329-367, October.
  15. Feld, Lars P. & Kirchgassner, Gebhard, 2000. "Direct democracy, political culture, and the outcome of economic policy: a report on the Swiss experience," European Journal of Political Economy, Elsevier, vol. 16(2), pages 287-306, June.
  16. Charles Blankart, 2000. "The Process of Government Centralization: A Constitutional View," Constitutional Political Economy, Springer, vol. 11(1), pages 27-39, March.
  17. Lars P. Feld & John G. Matsusaka, 2000. "Budget Referendums and Government Spending: Evidence from Swiss," CESifo Working Paper Series 323, CESifo Group Munich.
  18. Lars P. Feld & Bruno S. Frey, 2002. "Trust breeds trust: How taxpayers are treated," Economics of Governance, Springer, vol. 3(2), pages 87-99, 07.
  19. Frey, Bruno S & Stutzer, Alois, 2000. "Happiness, Economy and Institutions," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 110(466), pages 918-38, October.
  20. Kirchgassner, Gebhard, 1994. "Constitutional Economics and Its Relevance for the Evolution of Rules," Kyklos, Wiley Blackwell, vol. 47(3), pages 321-39.
  21. Kiewiet, D Roderick & Szakaly, Kristin, 1996. "Constitutional Limitations on Borrowing: An Analysis of State Bonded Indebtedness," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 12(1), pages 62-97, April.
  22. Anthony M. Marino & John G. Matsusaka, 2005. "Decision Processes, Agency Problems, and Information: An Economic Analysis of Capital Budgeting Procedures," Review of Financial Studies, Society for Financial Studies, vol. 18(1), pages 301-325.
  23. Vaubel, Roland, 1994. " The Political Economy of Centralization and the European Community," Public Choice, Springer, vol. 81(1-2), pages 151-90, October.
  24. Lars P. Feld & Stefan Voigt, 2003. "Economic Growth and Judicial Independence: Cross Country Evidence Using a New Set of Indicators," CESifo Working Paper Series 906, CESifo Group Munich.
  25. Pommerehne, Werner W., 1978. "Institutional approaches to public expenditure : Empirical evidence from Swiss municipalities," Journal of Public Economics, Elsevier, vol. 9(2), pages 255-280, April.
  26. Matsusaka, John G & McCarty, Nolan M, 2001. "Political Resource Allocation: Benefits and Costs of Voter Initiatives," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 17(2), pages 413-48, October.
  27. Steunenberg, Bernard, 1992. "Referendum, Initiative, and Veto Power: Budgetary Decision Making in Local Government," Kyklos, Wiley Blackwell, vol. 45(4), pages 501-29.
  28. Blomberg, S. Brock & Hess, Gregory D. & Weerapana, Akila, 2004. "The impact of voter initiatives on economic activity," European Journal of Political Economy, Elsevier, vol. 20(1), pages 207-226, March.
  29. Feld, Lars P & Savioz, Marcel R, 1997. "Direct Democracy Matters for Economic Performance: An Empirical Investigation," Kyklos, Wiley Blackwell, vol. 50(4), pages 507-38.
  30. Feld, Lars P. & Matsusaka, John G., 2003. "Budget referendums and government spending: evidence from Swiss cantons," Journal of Public Economics, Elsevier, vol. 87(12), pages 2703-2724, December.
  31. Romer, Thomas & Rosenthal, Howard, 1979. "Bureaucrats versus Voters: On the Political Economy of Resource Allocation by Direct Democracy," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 93(4), pages 563-87, November.
  32. James M. Poterba & Jürgen von Hagen, 1999. "Fiscal Institutions and Fiscal Performance," NBER Books, National Bureau of Economic Research, Inc, number pote99-1, January.
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Citations

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Cited by:
  1. Lars Feld, 2005. "The European constitution project from the perspective of constitutional political economy," Public Choice, Springer, vol. 122(3), pages 417-448, March.
  2. Schneider, Friedrich G., 2009. "Is a Federal European Constitution for an enlarged European Union necessary? Some preliminary suggestions using public choice analysis," Center for European, Governance and Economic Development Research Discussion Papers 83, University of Goettingen, Department of Economics.
  3. Simon Hug & Tobias Schulz, 2007. "Referendums in the EU’s constitution building process," The Review of International Organizations, Springer, vol. 2(2), pages 177-218, June.
  4. Gebhard Kirchgässner, 2010. "Direkte Demokratie," University of St. Gallen Department of Economics working paper series 2010, Department of Economics, University of St. Gallen 2010-26, Department of Economics, University of St. Gallen.
  5. repec:got:cegedp:83 is not listed on IDEAS
  6. Maaser, Nicola & Napel, Stefan, 2012. "A note on the direct democracy deficit in two-tier voting," Mathematical Social Sciences, Elsevier, vol. 63(2), pages 174-180.
  7. Mariana Bode & Oliver Budzinski, 2005. "Competing Ways Towards International Antitrust: the WTO versus the ICN," Marburg Working Papers on Economics, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) 200503, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  8. Dennis Mueller, 2005. "Constitutional political economy in the European Union," Public Choice, Springer, vol. 124(1), pages 57-73, July.

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